Category: Management

Abstract

The paper at hand provides a concise analysis of stakeholder management concept, its basic principles and potential challenges. One makes an attempt to summarize the insights provided by various researchers and work out the main characteristics of this type of management. Moreover, one tries to elucidate the role of various stakeholder groups in the management process and describe the impact the representatives of each group are likely to experience. Basing on the study of the collected data, one draws a conclusion that the key task of a stakeholder manager is to pursue a corporate policy that would take into consideration the peculiarities of its stakeholders demands so that the latter are constantly encouraged of continuing a mutually beneficial collaboration.

Introduction

Stakeholder management is a complex and complicated problem that is widely discussed by business analysts and researchers. Nowadays, the fact that successful stakeholder management is a determining factor of an efficient firms performance seems to be undoubted. Meanwhile, one should necessarily note that there are different opinions regarding the basic principles of this kind of management. Thus, Harrison and Wicks assume that one needs to put a particular emphasis on the four key factors that are likely to contribute to the formation of a favorable and long-lasting collaboration between a firm and stakeholders. According to the researchers, the relevant factors include four types of utility: physical, just, affiliable, and perspective (Harrison & Wicks, 2013).

In the meantime, pursuant to the suppositions of other researchers, Howitt, and McManus, the main concern of stakeholder management consists in involving stakeholders in a firms decision-making. Hence, the authors presume that stakeholders participation in this process is likely to help the managers carry out a more efficient targeting and avoid potential risks. In other words, they suppose that stakeholders integration in a firms decision-making might have a positive influence on its general performance (Howitt & McManus, 2012).

Stakeholder groups

Despite some discrepancies in the vision of the main aims of stakeholder management, most of the specialists agree on the point that firms are obliged to account for the needs of all the stakeholders groups so that the latter are willing to continue the cooperation. It is also critical to note that the management strategy should pay due consideration to the diversity of the stakeholders representatives. Thus, Harrison and Wicks suggest that this class is composed of customers, communities, and employees (Harrison & Wicks, 2013). Howitt and McManus, in their turn, believe that this group is significantly wider, as it includes supplier companies, particular political parties and various activist organizations (Howitt & McManus, 2012). One might, consequently, suppose that the key concern of stakeholder management is to maintain the balance between satisfying the demands of every group and promoting the interests of a firm.

Influence on employees

The analysis of various researches shows that stakeholder management has an impact on all the groups of stakeholders. Thus, one of the significant classes of stakeholders, employees, is likely to benefit considerably from a reasonable management. In accordance with Harrison and Wicks theory about utilities provision being the crucial concern of stakeholder management, one can assume that perspicacious managers are supposed to provide sufficient salaries, fair treatment and promising perspectives for the employees (Harrison & Wicks, 2013). Moreover, the factor of organizational affiliation also suggests that a firms managers should focus on creating a favorable image of their company so that the employees have a desire to associate themselves with the relevant organization, and thus have an extra motive to continue working on it.

As to communities, this type of stakeholders is also apt to receive a series of benefits from an effective stakeholder management. A professional manager is perfectly aware of the fact that a firm should be particularly careful about fulfilling the requirements of the community within which it operates. The principal options the management of a firm can offer to the community are potential workplaces and the improvement of the general environment.

Furthermore, the representatives of the local community can also be welcomed to take part in the decision-making of a firm. Pursuant to the assumptions of Howitt and McManus, stakeholder management should lay a significant emphasis on the integration of the community into the solution of the most critical problems (Howitt & McManus, 2012).

Influence on stockholders

The impact of stakeholder management on stockholders is hard to evaluate. Some specialists believe that there is a tendency to overestimate the importance of the interests of stockholders for effective management. Thus, Howitt & McManus believe that managers often tend to focus on providing the utilities required by stockholders, neglecting, in such a manner, the demands of other stakeholder groups (Howitt & McManus, 2012). Nevertheless, it is evident that affiliable and perspective utilities are particularly critical for this type of stakeholders. As a result, one might presume that a professional manager is likely to focus on these particular aspects.

Conclusion

In conclusion, one might suggest that the primary task of an employer is to perform a profound monitoring of the stakeholders the firm deals with and work out an effective strategy that would enable the company to fulfill the requirements of all the groups to the largest extent possible.

References

Harrison, J.S., & Wicks, A.C. (2013). Stakeholder Theory, Value, and Firm Performance. Business Ethics Quarterly, 23(1), 97-124.

Howitt, M., & McManus, J. (2012). Stakeholder Management: An Instrument for Decision Making. Management Services, 56(3), 29-34.

The topic of the Research Paper

The area of research is strategic management. Strategic management can be used to determine mission, vision, values, goals, objectives, roles and responsibilities, timelines, etc (Management faqs, n.d.). The topic selected for my research is Strategy Implementation in the Strategic management process.

Abstract

The importance of strategy implementation in the field of strategic management process is very high. The effective implementation only can result in the success of the management of the strategies planned. The study involves identifying the various processes involved in the strategy implementation and determining the aspects of successful implementation.

Introduction & Background

The strategic management is a stage of decision-making job in defining the aims and objectives. For an efficient approach to the strategic management, a well-defined strategy implementation process has to be accomplished. Strategic Implementation is defined as the process by which strategies and policies are put into action through the development of programs, budgets and procedures (Strategy implementation, 2009, para.1). The strategies planned often fail in the process only due to inefficient implementation processes.

Objectives of the Research Paper

The strategic implementation in the strategic management process is the key to unlocking the success in the process. The strategy implementation process is always associated with the whole strata in the firm starting from the manager to all employees below him. The efficiency in implementation defines the output from each of the employees and thus the strategy implementation becomes significant.

Literature Review

Strategy Implementation

Strategic implementation offers the main track to the activities and is intimately related to the field of strategic management. Thinking strategically about implementation and developing an effective implementation plan are important tasks on the road to realizing the strategies developed (Bryson, 2004, p.50). The identification of the activities to be carried out and set a plan based on those identified strategies are not sufficient. Even a most efficient plan can result in failure, if the plan is not implemented properly. The recognition of strategies accompanied by effective implementation is essential for success.

Strategy is defined as the framework of choices that determines the nature and direction of an organization (Brache, & Bodley- Scott, 2005, p.5). The framework should be implemented using a proper implementation plan set prior to actual implementation process.

The distribution and organization of all the resources and launching substitute arrangements for fractious functioning are all to be arranged according to the requirements of the strategies. Each strategy should be assigned to the correct individuals or groups who possess the necessary skills to reach the successful completion of the strategy. Monitoring and training are the other requirements of the strategy implementation process. The main necessity in the field of strategy implementation is the consistency of all involved in the process.

Components of Strategy Implementation

The strategy implementation is executed using the components defined for it. The book mentioning strategy implementation named Implementation: how to transform strategic initiatives into blockbuster results by Alan P. Brache, Sam Bodley Scott clearly identifies and explains the eight components of strategy implementation. Inside the business, surrounding strategy, are the eight components of strategy implementation: leadership, business processes, goals and measurement, human capabilities (people skills), information/knowledge management, organization structure and roles, culture, and issue resolution (Brache, & Bodley- Scott, 2005, p.8).

Leadership

The leadership should be a group of experts who can develop a plan which always seeks success. The leadership alone is responsible for the formulation of various strategies and action plans. The overall success of the strategy implementation process depends on the efficiency of the plan.

Business processes

The different processes in the field of business also influence strategy implementation. The position in the market, rivals, challenges etc in the business affect the strategy implementation process.

Goals and measurement

The setting of goals is a very important factor in the strategy implementation. It is very important to have a clear picture as to what is to be achieved at the end. The measurement of the distance remaining from the actual goal can be analyzed frequently.

Human capabilities

The inherent talents and abilities of the employees along with the leadership groups play an important role in strategy implementation. The poor level of human resources can result in the failure of the entire plan. Proper learning, as well as training, is essential for developing talents and skills for accomplishing the assigned strategy.

Information/knowledge management

The knowledge about the entire plan and the techniques required to meet those strategies is an essential component in the case of strategy implementation. Lack of information about it may lead to poorer results of strategy implementation.

Organization structure and roles

The structure of an organization has various vertical as well as horizontal levels. The horizontal levels include the peers who are working in parallel with vertical levels from top to bottom. The communication and link gaps between the different groups are also a component of strategy implementation. The roles for each individual in the organization are having an importance that cannot be replaced by another.

Culture

The culture and emotional backgrounds of the managers, as well as the employees, affect the implementation process. Each should have actively committed motivation to reach the needed result for every strategy.

Issue resolution

Issue resolution is an essential component for carrying out the correspondence and follow-up in the strategy implementation. Successful use of the process ensures that employee concerns are addressed, increasing trust and open, honest communication among all employees (Issue resolution, 2009). The maximum exploitation of the procedure is necessary for succeeding to meet the goals set. It is a component with strength of the voice of ideas from all levels of the organization which improves the implementation process.

Supporting Factors of Strategy Implementation

Organizations successful at strategy implementation effectively manage six key supporting factors. They are:

1. Action Planning
2. Organization Structure
3. Human Resources
4. The Annual Business Plan
5. Monitoring and Control
6. Linkage.

Action Planning

Any objective to be met should undergo various steps of action which require development of a plan to work it out. The action plan development should involve a real idea about the various strategies to be implemented and who should carry out those. Each strategy should be sketched out with exact clarity.

Organization Structure

The analysis of the required environment for accomplishing the set strategies is essential which evaluates whether the present atmosphere of the organization is adequate for the process. This is much essential for successful implementation.

Human Resources

The main and foremost factor that results in the success or failure of the implementation process is the human resources without which nothing is possible. The different strategies may need different skills and approaches. The human resources should meet those in the course of work. For this, sometimes training and conquering of new skills are required or brushing up of the skills already present is required.

Annual Business Plan

The expenditure for each strategy should be identified at the time of planning itself. These should then be linked to the annual business plan so that the budgeting of the expenses on each strategy is well defined. The annual business plan thus eliminates the confusion that may occur at the phase of budgeting.

Monitoring and Control

An important part of strategy implementation is monitoring (Birnbaum, 2009, Monitoring your progress, para.1). The implementation carried out should be supervised constantly in order to have an idea of the process carried out. The pace of work, any failure in between, lack of expected skills etc are determined so that the required alterations can be done for the best results. The control over the employees for reaching the required point of work by the scheduled period and time becomes essential in several aspects of implementation. If the drawbacks at the initial stages are identified, the strategy implementation becomes a more efficient one. Further developments can thus be initiated accordingly.

Linkage

Linkage, as the name indicates, involves the joining of all the steps and activities in the process so that the real-time success in the process can be attained. Action Planning, Organization Structure, Human Resources, Annual Business Plan and Monitoring & Control should be associated in such a way that each helps to the success of the other. Both vertical as well as horizontal linkages are required. Vertical linkages refer to the relation from the top to the bottom while the horizontal linkage is the relationships between the peers. Linking creation and implementation support the overall process, and thus a dynamic strategy emerges and evolves (Kotelnikov, n.d., Linking creation of a strategic intent with its implementation, para.1).

Strategic Initiatives

The strategic initiatives are the real processes to be carried out to achieve the virtual goals set. It is those initiatives that are depicted as various strategies accomplished. Apart from the identification of strategic objectives, the selection of strategic initiatives is the most important component. Initiatives are much more important than metrics, which are simply a mechanism for monitoring progress toward strategic goals (Creelman, 2009, The importance of strategic initiatives, para.1). The identification of the goals and the conceptual ideas towards the reach of goals is followed by the planning of different strategies. These strategies are realized by the strategic initiatives. So, the defining process of the initiatives is of great importance.

Killers of Strategic Implementation

The real enemies of the successful strategy implementation are identified in different ways by different persons and organizations. They are: Top-down senior management style; unclear strategy and conflicting priorities; an ineffective senior management team; poor vertical communication; poor coordination across functions, businesses, or borders; and inadequate down-the-line leadership skills and development (Beer, & Elsenstat, 2003, para.2).

A gap between the higher and lower levels of organization can lead to an unsuccessful strategy implementation. The poor leadership from the part of the top layers can result in a complete failure of the launch of strategies. The blurred ideas of various strategies and least effective communication in the organization can result in utter failure. The reduced management and developmental procedures within the firms are of great threat. Another killer in the field of strategy implementation process is the information load. This is seen in most of the scenarios in the management sector worldwide. Information load is defined as &a complex mixture of the quantity, ambiguity and variety of information that people are forced to process. As load increases people take increasingly strong steps to manage it (Weick, 1995: 87) (Flood, 2000, p.20).

Roles of Strategic Implementation

The strategy implementation process is the realization of the concepts set by managing groups after the identification of various strategies and leading to the development of strategic initiatives. Organizations are complex social systems with entrenched ways doing things; systems, behaviors and cultures. They are inertial, which means that they will tend to go in the direction they are heading already unless potent forces direct them otherwise (Loizos, 2000, para.2). Since the implementation is carried out by individuals from different environments, the success in the process can be attained only by directing all those from different backgrounds to work in a similar way with a single aim.

The strategies set for the implementation may be very much efficient, but the output received is according to the capable method of implementation. Thus, it is clear that implementation is of most importance in the field of strategic management.

Findings and Analysis

Strategy implementation is the most important step in the strategic management field. The process of implementation is influenced by the emotional and environmental aspects of the manager as well as the employees. The relationship within the organization is a very essential factor in strategy implementation. The effectiveness of the strategic plan can be of use only if they are implemented properly within the stipulated time.

The strategy implementation phase can succeed only if the entire levels in the firm are aware of the goals, strategies, their outcome and the course of the work carried out. The time stipulation is of great importance and this significance should be conveyed to each of the individuals involved in the real implementation process. Uniformity has to be maintained within and externally so that the business aspects are met with ease.

Many companies repeatedly fail to truly motivate their people to work with enthusiasm, all together, towards the corporate aims. Most companies and organizations know their businesses, and the strategies required for success (Strategy implementation and realization, 2004, para.1). The potential of an organization becomes of least valued, if the coordination in the implementation of strategies cannot be met. The entire firm should be well organized and harmonized so that the goal set should be the aim for each of the individuals and the strategy should be carried out with full commitment.

The killers of the successful strategy implementation should be eliminated to maximum limit and the keys for the success should be identified and achieved. The entire level of the organization should work in a fully harmonized relationship. The atmosphere at the workplace must be pleasant and calm so that no emotional attacks occur. The involvement of the employees in each and every phase of strategy implementation is necessary for victory over the killers of strategy implementation process.

A strategy plan becomes competent only when the implementation of those strategies is done in a proficient manner. Fuzzy thinking, fuzzy focus, unwillingness to deal directly with difficult issues, lack of attention to integration and follow-up after an acquisition, and not having the right team at the table early in the game are all symptoms of implementation gone awry (Giuliani, n.d., p.4). The start of accomplishing the strategies to the completion of the entire process after achieving the goals set is only according to the strategic plan but with the process of strategy implementation.

Conclusion

The study on the topic Strategy Implementation leads to the awareness that the interrelationships and communication between the higher and lower levels of the organization are much essential for succeeding in strategic management. The killers are to be identified and killed with parallel implications of useful factors. The time and resource limitations are to be made clear along with the different strategies. Only with the effective strategy implementation, the strategic plan becomes significant; else of least value. Thus, it becomes clear that the absence of a proper implementation process is the real reason for the failure of many of the good projects launched.

Reference

Beer, M., & Elsenstat, R A. (2003). The silent killers of strategic implementation and learning. Many Worlds: Thought Leadership for Business. 2009. Web.

Birnbaum, B. (2009). Strategy implementation: six supporting factors. Birnbaum Associates. Web.

Birnbaum, B. (2009). Monitoring implementation of your strategic plan: Monitoring your progress. Birnbaum Associates. Web.

Brache, A P., & Bodley- Scott, S. (2005). Implementation: how to transform strategic initiatives into blockbuster results: What is strategy. McGraw Hill Professional. 5.

Brache, A P., & Bodley- Scott, S. (2005). Implementation: how to transform strategic initiatives into blockbuster results. McGraw Hill Professional. 8.

Bryson, J M. (2004). Strategic planning for public and nonprofit organizations: a guide to strengthening and sustaining organizational achievement: Step 9: develop an effective implementation process (3^rd ed.). John Wiley and Sons.

Creelman, J. (2009). Choosing strategic initiatives: The importance of strategic initiative. EPM Review. Web.

Flood, P C. (2000). Managing strategy implementation: an organizational behaviour perspective. Wiley-Blackwell. 20.

Giuliani, P A. (n.d.). Implementation- the gutsy challenge in strategic planning: Work steadily on infrastructure. Smock Sterling: Strategic Management consultants. 4. 2009. Web.

Issue resolution. (2009). PSEG: We Make Things Rock. Web.

Kotelnikov, V. (n.d.). Strategic achievement: Liking creation of a strategic intent with its implementation. 2009. Web.

Loizos, H. (2000). Role of strategy implementation in organization development, the. Organizational Development Journal. BNET. Web.

Management faqs: Strategic management: What is strategic management. (n.d.). 2009. Web.

Strategy implementation. (2009). Oppapers.com. Web.

Strategy implementation and realization: systems and processes for successful implementation of organizational strategy and business development plans. (2004). Business Balls.com. Web.

Abstract

Risk management is the key to successful projects. A risk management strategy gives a coherent approach for dealing with uncertainties that a project may face in a holistic manner. Uncertainty is unavoidable in projects because they have inherent variability of constraints and premises and involve diverse stakeholder interests. In this view, risk management may be construed as a means of navigating through the uncertainty to control the cost/impact and probability of occurrence of the identified risks. It enables organisations to identify, assess, and control risks to maximise project outcomes. A number of models, frameworks, and tools exist for understanding each step of the project lifecycle. Drawing on best practice principles and models, this report analyses the risk management strategy and processes for achieving organisational goals in the contexts of procurement and complex projects.

Introduction

Effective risk management is the hallmark of successful projects. It ensures the delivery of project results is within budget and on time to support the organisations strategic goals. Risk is inevitable in projects because of the variability of project constraints and stakeholder demands. The failure to manage risks effectively may negatively affect multiple project goals with implications for timelines (delay risk), cost, or quality (Alexander & Sheedy 2004). In this view, proactive actions by project managers could help identify risks and mitigate them based on best practice principles. Risk management gained much interest in the late 2000s in the wake of the 2008 financial crisis. It is now considered a critical process in all major projects and involves a range of complex tools for risk identification, such as risk registers and SWOT analysis. The aim of this report is to analyse the concept of project risk, risk measurement and ranking, and risk management strategy, and best practices in risk management.

The Concept of Project Risk

The risk may be conceptualised as an uncertain event that could potentially affect project goals (Holton 2004). It can be contrasted with opportunity, which may be construed as the desired positive event. Historically, risk has been associated with the uncertainty or fear that surrounds personal decisions. The type of decision or choice made relies on the individuals personality, i.e., risk averseness or risk-taking behaviour. In business, the concept of risk takes a different form; the risk could be interpreted as a threat or an opportunity for growth.

Although multiple perspectives exist on the concept of risk, they converge on the view that risk is linked to uncertainty towards a potential threat. Holton (2004) defines risk as a state of affairs connected with the possibility of a deviation from a desired outcome of a project (p. 23). The desired outcomes could be the budgeted cost, delivery time, and quality (Holton 2004). On his part, Murray-Webster (2010) considers risk as an uncertain event with a positive or negative impact on project goals when it occurs. A good example is the supply chain delay that leads to transportation risk. Therefore, a risk could be conceptualised in two ways: first as an unwanted probability event, which hinders the attainment of the performance targets of a project, and second as the cause of the undesirable event. A risk is a probability event that depends on exposure. Thus, risk assessment takes into account the values of the outcomes (expectation value) and their respective probabilities.

It is clear that uncertainty and exposure are critical components of risk. Uncertainty, defined loosely, is a state of being unsure of a propositions outcome (Hubbard 2009). An example of uncertainty is the rolling a six-sided dice in a casino where obtaining a four indicates a win is an uncertain task. The chance of winning is a sixth. However, if the one is uncertain of the number of sides of the dice, then the probability of winning or the risk of loss may not be known. Uncertainty arises when cannot perceive the outcomes or proposition. Therefore, in uncertainty situations, probability has limited usefulness.

On the other hand, exposure is the self-consciousness experienced when exposed to a proposition. In most cases, the perceived exposure relates to relevant events as opposed to immaterial ones (Hubbard 2009). Importantly, uncertainty does not affect exposure, which means that being uncertain of an event does not mean the absence of exposure. For example, exposure may arise when a firm incurs financial loss due to the lack of a risk management plan. In this case, the firm is certain of possible loss whenever exposed to an identified event.

In this view, the risk is the exposure to an event that an individual is uncertain of currently (Alexander & Sheedy 2004). A project introduces new changes to an organisation, which lead to uncertainty. Exposure to uncertainty creates risk. An organisation brings together risk-takers, including investors, staff, and stakeholders. The identification, assessment, and mitigation of risks through an effective risk management plan are essential for project success. The process entails decision-making and evaluation of choices based on experience, risk attitude, and resources available. For example, public and health institutions often adopt a risk-averse attitude due to the view that risks lead to losses. On the other hand, venture capitalists and entrepreneurs are driven by a risk-seeking attitude, believing that opportunities exist in risky contexts.

Risk Measurement and Ranking

The measurement and ranking of project risk constitute a key step in the risk management process. After the risk has been identified, a qualitative and quantitative analysis is done to evaluate and subsequently manage the risk. Risk assessment entails risk estimation and risk evaluation steps. Risk estimates can use the qualitative or quantitative approach to rank or express the risk numerically (Dorfman 2007). The aim of estimating risks is to establish a ranking of risks grounded on their cost impact. Cliland (2004) writes that to prioritise risks, and understanding of the probability of each threat and opportunity, effect on project goals, and expected time of occurrence is required (p. 81). The assessment step may involve techniques such as constructing a probability tree, Pareto assessment, and expected value assessment. The project manager may use risk monetary value, probability, or its impact to rank the risk (Cliland 2004, p. 83). The chosen risk metric depends on the firms risk management strategy. The estimation step of the risk assessment process is summarised in figure 1 below.

Monetary-based ranking of risks using the EV method can be achieved using the following formula: RMV = P x RIV, where RMV is the risk monetary value, P is the probability, and RIV represents the risk impact value. The risk probability may be computed based on expert advice or using the Delphi method (Gallati 2003). The aim is to obtain a consensus risk probability that could be used to rank the identified risks. The Pareto method could also be used to select a risk with the most significant impact value. An example of project risk ranking using the risk monetary value is shown in table 1 below.

Table 1: Risk Monetary Value.

The RMV method facilitates the comparison and prioritisation of risks. The ranking of risks is founded on a project risk management strategy of a firm. In this case, the RMV varies depending on the risk effect and the likelihood that range between low and high in the probability and impact dimensions. This matrix gives a risk profile for a given project. An example of a risk profile is given in Table 2 below. It is evident that risks 7 and 8 require urgent action because their RMV is high.

Table 2: An Example of a Project Risk Profile.

The risk evaluation step entails determining the overall risk exposure based on the net impact of threats and opportunities on the project (Spedding & Rose 2011, p. 58). The aim is to ensure that the project risk is within the thresholds prescribed by the organisations risk policy. The evaluation step is summarised in figure 2 below.

The evaluation can be done using the monetary value approach. The expected monetary value is the product of risk and its likelihood of happening (Spedding & Rose 2011). The sum of the values gives the expected monetary value of a project. An example of an evaluated risk monetary value is shown in table 3 below. The risks may cost the project $141,000. The organisation can choose to proceed or terminate the project based on this value.

Project Risk Management Strategy

Mitigating risks in complex or international projects requires a risk management strategy. This iterative process entails sequential steps for managing risks throughout the project lifecycle in line with the set strategic objectives. It gives a coherent approach for identifying, assessing, and managing risk (Smith & Fischbachera 2009, p. 7). For an international project, the five steps of the risk management model may include risk identification, assessment, mitigation planning, implementation, and communication.

Risk Identification

It entails a structured process of identifying high probability risks or events that are threats to the project. A project manager may use checklists to identify risks. The potential risks depend on the nature of the project including its strategic goals, activities, and constraints, among others (Cliland 2004). Besides risk checklists, risk categories (group technique), questionnaire, and constraint analysis may be used to identify the risk sources. Examples of risk categories include financial, contractual, cost, people, technical, political, etc. For instance, people risks may be skill deficits in the project.

Hillson (2003) utilises the work breakdown structure (WBS) model to organise potential risks into distinct categories. The resultant risk breakdown structure is summarised in a table, which essentially lists the potential risks inherent in a complex project. The approach supports a clear understanding of risks that exist within the WBS framework. The only downside of this model relates to its restrictiveness; thus, it cannot identify unknown risks. The aim of project risk identification is to generate a clear analysis of the cause, event, and effect of each risk (Hillson 2003, p. 87). A risk cause is the source of risk while a risk event is a threat or opportunity resulting from an identified risk. An example could be poor supply chains (cause) that affect inventory management (event). A risk effect is an impact that the risk may have on the projects goals.

Risk Evaluation

The identified risks are evaluated to determine their likelihood of happening and impact on project goals. Risks vary in terms of probability and impact. Certain risks are more likely to occur than others are. Additionally, the severity of the loss differs significantly between risks. Therefore, a project team may use risk evaluation criteria to narrow down on a few high-probability risks that have a significant effect on project performance. For example, if the risks that raise costs by 4 per cent are considered high-impact risks, the teams mitigation plan should focus on these risks to reduce the impact. An example of a risk evaluation matrix is shown in table 2 above. From the table, it is clear that risks 7 and 8 have the highest likelihood of occurring and the greatest effect on the project.

Based on the RMV framework, a positive correlation exists between complex projects and risk severity (Dorfman 2007). Therefore, a multisite international project is a high-risk endeavour due to the massive resource requirements. The project team will need to allocate resources appropriately to achieve the set objectives. Additionally, complex technology e.g., aircraft parts, will be required for an international aviation project, raising the potential for unexpected challenges. Risk evaluation for complex projects should involve brainstorming sessions or workshops to assess each risk event to establish its probability of happening and cost or effect on the project. The probability and cost may be low, medium, or high depending on the nature of the risk. Therefore, cost and likelihood rankings determine the risk management strategy to be used.

Evaluating a Procurement Risk

Delays in the delivery of project equipment constitute a procurement risk. An analysis of the vendor or supplier would help determine the likelihood and potential effect of the procurement delays. A formal risk assessment would unearth this risk, especially in complex projects. However, few project managers use this approach. A study by Parker and Mobey (2004) found that project managers rarely conduct a structured analysis of procurement risks due to a limited comprehension of the assessment tools (p. 27). In addition, some managers were risk-averse or reactive, limiting the success of complex projects.

In big projects, developing a list of events considered risky and monitoring them throughout the project lifecycle may alleviate risks. A formal risk assessment process could also help evaluate the risk profile at different stages of the project. Statistical models may be employed to assess risks, especially in projects involving many variables or combinations. An example is the Monte Carlo model, which is a useful method for evaluating risks in highly complex projects. It simulates the range of outcomes through a trial and error method involving various combinations of risks based on their likelihood (Horwitz 2009, p. 77). The model gives the project team the range of possible outcomes based on different likelihood/impact combinations. For example, the simulation may indicate that there is a 10% likelihood that procured equipment will be delivered late and its impact on the project.

Risk Planning

Risk planning entails developing reactionary management actions to eliminate threats and capitalise on opportunities. The threat responses may include avoidance measures, e.g., reducing the likelihood or effect, falling back to minimise the impact, or transferring the risk (Tusler 2006). The organisation can also choose to share or accept the risks. On the other hand, opportunity responses may include exploitation, rejection, or enhancement of the risk. Besides the risk response planning, a firm may use cost-benefit analysis or decision tree to devise appropriate responses to risk-related threats or opportunities.

Implementation of the Risk Plan

A risk management strategy should give a risk response plan to track and control risks at different stages. An efficient implementation process requires that the roles of the risk response team be identified. The risk owner is the firm that tracks and controls allocated risks to enhance the returns (Tusler 2006). On the other hand, the risk auctioneer supports the risk owner in implementing the risk plan.

Risk Communication

A clear communication management strategy is required to pass information related to the risks to stakeholders. The information could be communicated in terms of highlight reports, checkpoint reports, or lessons learned reports. The information could be communicated in meetings bringing together project stakeholders from different countries. For example, an international conference could be held to communicate an aviation project risk to stakeholders. An iterative process of tracking and controlling risks should be implemented using tools like variance analysis and reserve analysis to identify appropriate corrective actions.

Best Practices in Risk Management

In practice, the project manager selects the risk mitigation strategies. As the risk owner, he or she decides on the risks to minimise based on their impact and likelihood of occurrence. Another approach involves identifying the sources of the risks (root cause analysis) and applying corrective actions to reduce the probability and likelihood of occurrence of more than one risk. Subsequently, the risks could be rated based on the mitigation costs to minimise their effects (Benta, Podean & Mircean 2011). The aim is to reduce the aggregate project risk, i.e., the total value of all risks.

Different strategies are used to minimise the quantified project risk. The first method is risk avoidance. In this case, the project manager avoids activities that would ultimately cause risk. For example, the manager could choose low risk activities to reduce the overall impact. However, this option may not be economically viable, especially for large projects where profitability growth requires risk taking. The second approach is reducing the adverse effects of the risk or its impact on project goals, which may include delays, costs, or diminished quality (Benta, Podean & Mircean 2011). The risk manager may opt to transfer a high-probability risk to a third party to minimise the risk impact. For example, insuring equipment in transit could reduce the risk impact related to delays, which helps transfer the risk.

It is important to note that the aim of risk management is not to remove all risks, but to reduce the likelihood of occurrence and impact on project goals. In practice, the project manager develops a detailed report of mitigation actions for all identified risks. The report contains the costs, roles, due dates, and outcomes of the mitigation actions (Smallman 2009). The mitigations should aim to minimise high-impact/probability risks within acceptable costs. A risk analysis framework helps visualise the mitigation costs and the impact of risks in the absence of mitigation (Smallman 2009). Thus, the project manager should rank the mitigation actions based on cost and effect to determine when they should be implemented and by whom. The implementation of the measures should involve the entire project team.

Conclusion

Risk management in a project entails identifying, monitoring, and controlling risks throughout the projects lifecycle. It involves various models for risk identification, evaluation, and mitigation to minimise the likelihood of occurrence and impact on project goals. Complex high-risk projects require effective risk management strategy to ensure that the project meets its objectives.

References

Alexander, C & Sheedy, E 2004, The Professional Risk Managers Handbook: A Comprehensive Guide to Current Theory and Best Practices, PRMIA Publications, Wilmington, DE.

Benta, D, Podean, M & Mircean, C 2011, On Best Practices for Risk Management in Complex Projects, Informatica Economica, vol. 15, no. 2, pp. 142-151.

Cliland, D 2004, Field Guide to Project Management, John Wiley & Sons Ltd, New York.

Dorfman, M 2007, Introduction to Risk Management and Insurance, Prentice Hall, Englewood Cliffs, NJ.

Gallati, R 2003, Risk management and capital adequacy, McGraw-Hill, New York.

Hillson, D 2003, Using a Risk Breakdown Structure in Project Management, Journal of Facilities Management, vol. 2, no. 1, pp. 8597.

Holton, G 2004, Perspectives: Defining Risk, Financial Analysis Journal, vol. 60, no. 6, pp. 19-25.

Horwitz, R 2009, Hedge fund risk fundamentals: solving the risk management and transparency challenge, Bloomberg Press, Princeton, NJ.

Hubbard, D 2009, The Failure of Risk Management: Why its Broken and How to Fix it, John Wiley & Sons, New York.

Murray-Webster, R 2010, Management of Risk: guidance for Practitioners, Office of Government Commerce, London.

Parker, D & Mobey, A 2004, Action Research to Explore Perceptions of Risk in Project Management, International Journal of Productivity and Performance Management, vol. 53, no. 1, pp. 1832.

Smallman, C 2009, Knowledge Management as Risk Management: A Need for Open Governance?, Risk Management, vol. 1, no. 4, pp. 7-20.

Smith, D & Fischbachera, S 2009, The changing nature of risk and risk management: The challenge of borders, uncertainty and resilience, Risk Management, vol. 11, no. 1, pp. 112.

Spedding, L & Rose, A 2011, Business Risk Management Handbook, London, Elsevier.

Tusler, R 2006, An Overview of Project Risk Management, Web.

Marketing mix

According to Stone (2001) the marketing mix comprises four components commonly referred to the 4ps. They include the price, product, promotion and distribution (place). The marketing mix of the Fabulous Cosmetics was formulated using the SMART principles.

Marketing objectives and goals

The following are the specific marketing objectives and goals based mainly on the marketing mix and they include.

• Introduce new Fabulous Cosmetics products in the new market and become the largest market shareholder by 2012
• Meet the consumer needs and satisfactions by delivering the products in time to all customers, outlets, subsidiaries, among other distribution places.
• Achieve the organisational goals and objectives as well as making profits in the financial year through promotions.
• Use the internet and social networking sites as well as the mobile phones to market and promote the companys products.
• Create a positive company image and reputation so as to place itself above the par of other competitors in the cosmetics market.
• Become the leading supplier and distributor of the new innovated cosmetics in USA and UK in a period of six months.
• Have a headquarter office and subsidiary within the next one year for easy transactions
• To increase the market share to more that 50% in 2012 through increase in promotional expenditure by more than 15%.
• To obtain the customers ratings on satisfaction of not less than 95% on the 2012 cosmetics annual customer satisfaction survey.
• To retain not less than 85% of customers in this current year in the 2012/2013 financial years as part of repeat purchasers.
• To attain a 12% investment returns at the end of first financial year in 2012 with a payback based on new product investments in less than four years.
• Spend at least 15% of the sales revenues in the 2011/2012 and the 2012/2013 financial years on research and developments with the aim of introducing new 5 brands in 2012.
• Have a competitive market price that would beat the competitors price in the first quarter by the end of 2011.

By integration of these marketing objectives based on the marketing mix would make it possible to achieve the objectives and goals of the fabulous cosmetics.

Marketing strategies

The marketing strategies for Fabulous Cosmetics are market oriented based on each marketing mix. The following are the specified and applicable specific market oriented strategies.

Price

AlKumar (2001, p. 216) notes that pricing is essential and should meet the consumers expectation in relation to the market demand and the quantity supplied. He adds that it should meet the marketing strategies of the organization. Use market penetration pricing strategy to beat the competitive price in the market through a low price offer in the first quarter. The company would adopt a discount strategy as part of pricing strategy where if a customer buys more than 5 products will have an extra product.

Product

The essence of having marketing strategy based on the product is to enhance sales and meet the competitors demands (Barker & Angelopulo, 2006). Applicable marketing strategies based on the fabulous product include; branding the cosmetics products in a more appealing way and repackaging them is a mode not applicable by other competitors. The use biodegradable ingredients which are environmentally friendly with the aim of conserving the environment is also recommendable. Going green will attract more customers than the competitors.

Place (distribution)

Strategic placement of the store is necessary for customer attraction and convenience (Lamb, Hair, & McDaniel 2006). Several outlets will be set around busy bus terminals and tourist attraction places. Leading stores, drug stores, supermarkets, personal care stores, department stores, specialty stores will be identified to sell the cosmetics on behalf of Fabulous Cosmetics Company. Orders will be available online, and deliveries will be made on weekends between 11am and 3pm to different beauty parlors and saloons. The company with also focus on acquisition through mergers after the second financial year so as to increase the market base and share to the already untapped markets

Promotion

To get the attention of the customers the company will use online advertisement as one way of promoting the sales (Mullin, 2010). Social networks like face book, MySpace, twitter among many other will be used to advertise. The company will also launch a blog where customer views and comments will be accessed and any changes rectified. Bill boards will also be used to promote the company and endorse movie stars in According to Mullin (2010, p. 37) promotion may include some aspects like value promotions and price promotions

D. Controls Analysis and Action Plan

Monitoring and evaluation are essential in determining the direction of the market, in regard to the product being sold (Lamb, Hair, & McDaniel, 2006). The company will monitor sales on daily and weekly basis and check whether there is any correlation between the products bought and the demand. They will also use correlation analysis to determine the price and number of customers in relation to the overall market demand. After first six weeks, the company will establish whether the market share is worth pumping more money. The analysis will be carried by the marketing strategic management team with outsourced human resource who are experts in the market.

Hutt and Speh, (2010) notes that the marketing strategist in the company must plan, evaluate, monitor and implement the marketing plan. The company will have a scoreboard to monitor the progress of the company where following will be measured; the business process, the growth and earnings of the company and the perspective of the customer towards the company. The company expects to have an overall turnover of over 10% in the first quarter. But depending on the outcome which for this cases the company expects a profit, evaluation will be based on the turn over.

Competitive advantage

Fabulous cosmetics completive advantage is based on the following strategies. Cost leadership strategy where it will lower its prices than those of its competitors at the same time giving quality products (Kotler & Armstrong, 2001). It will also use the differential strategy because of its new product that is unique in making through the latest technology. Lastly it will apply the focus strategy, mainly focusing on the targeted population that is not yet penetrated by the competitors. The companies will apply these strategies to tap the opportunities and circumstances that lay in future on their advantage to compete well in the market.

Reference List

AlKumar, N. et al. (2001).Marketing Management. India, Anmol Publications PVT Ltd.

Barker, R., & Angelopulo, G. (2006). Integrated organisational communication. Cape Town: Juta Academic.

Hutt, M. D., & Speh, T. W. (2010). Business marketing management: B2B. Mason, OH, South-Western Cengage Learning.

Kotler, P., & Armstrong, G. (2001). Principles of Marketing (Custom Edition ed.). Upper Saddle River, N.J.: Prentice Hall.

Lamb, C. W., Hair, J. F., & McDaniel, C. D. (2006). Essentials of marketing. Mason (Ohio), South-Western.

Mullin, R. (2010). Sales promotion: how to create, implement & integrate campaigns that really work. Philadelphia: Kogan Page Limited.

Stone, P. (2001). Make marketing work for you: Boost your profits with proven marketing techniques. Oxford: How to Books.

Case Scenario

The company selected for this scenario is Bechtel Group Inc. It is the largest construction and civil engineering company in the US, which specializes nearly every sphere of construction work ranging from infrastructure to mining and metals, oil, gas, chemicals, and nuclear engineering. It is famous for its participation in various megaprojects across the USA and abroad, having taken credit for the construction of the Hoover Dam, Jubail Industrial City, Chernobyl containment shelter, Riyadh Metro, and many others (Company Overview).

In this scenario, I will undertake the role of a production manager in charge of a group of 6 stonemasons. Stone masonry is an important part of the construction process, as the use of bricks and blocks is very common in the construction of walls and barriers within houses, apartment blocks, and other facilities (Walker 55). Brick is a very popular construction material in Europe in Asia, and the use of foam concrete blocks is universal across the world, as these blocks have excellent soundproof and warmth containment qualities.

Thus, stone masonry remains an integral part of any construction effort (Walker 56). At the same time, their labor is fairly monotonous and easily quantifiable, which makes the projections of labor, materials, and payments easier to make.

Identifying Resources in Achieving Organizational Objectives

As a manager (or a brigadier) of a working group in a construction company, there will be several types of strategic resources available to me that will improve my ability to achieve organizational objectives. Recognizing and understanding what resources are available to a manager is the first and most important part of resource management on any level. The resources available to me are (Hardin and McCool 36):

• Human resources  these resources are directly associated with the employees under my command. These include their quantity and labor capabilities, productivity rates and morale, as well as training, personal skills, and mental capabilities. In this scenario, my human resources are 4 stone masons and 2 general workers. The masons perform the main part of the production process, which involves building out and inner walls within houses, apartment blocks, adjacent structures, and other facilities. They all have similar levels of skill and the same mason grade. General laborers perform supportive functions such as hauling heavy equipment and materials and performing other kinds of duties that do not require a particular degree of skill.
• Financial resources  financial resources are resources available to the manager as part of the organization. They include allocated project funds as well as any other sources of income, be that shareholder values, personal resources, investments, credit loans, etc. As I am a minor brigadier in a large organization, the only resources available to me would be the resources of whatever project the company is currently engaged in.
• Physical resources  these resources cover a vast variety of physical instruments and objects that are required for achieving any organizational goals. The resources available to me, in this scenario, include instruments, construction materials, such as bricks, mortar, concrete, and other related equipment.

Using all of these resources in a timely and efficient manner, as well as passing on information when additional resources are required, is necessary for successful achievement of organizational objectives.

Annual Production and Resource Plan

Human Resources

For this scenario, let us assume that the brigade has to work on a project for an entire year, except winter, as winter is cold and severely limits the effectiveness of the laborers. Home construction tends to take a pause during winter due to this factor. In a 6-man brigade, 4 stonemasons are occupied with erecting walls and barriers, and two are manning the mortar machine, as without mortar no walls can be built (Hardin and McCool 73).

They are also tasked with fetching materials and tools when required. There is an average of 22 working days in a month, which means that, excluding winter, the brigade will have 198 working days in a year. This number does not include sick leave and holidays. In order to account for these losses, for estimation purposes, the total amount of working days has to be reduced by 7% (Harris and McCaffer, 134). Thus, the total working time of the brigade is calculated as 198 days * 0.93 = 184 days.

Physical Resources

The standard productivity ratios for a stone mason is 60 blocks per working day, which is the equivalent of 2 cubic meters (Rodrigues). Mortar expenditure for foam block masonry is 70 kilograms of mortar per cubic meter (Hardin and McCool 74). So, the average resource spending per stone mason is as follows:

• 120 foam blocks (2 cubic meters) + 140 kilograms of mortar / day.

If we multiply this notion by 4, we get 480 foam blocks (8 cubic meters) + 560 kilograms of mortar per day. If a month has 22 working days, then the total output by the brigade would be:

• (480 foam blocks (8 cubic meters) + 560 kilograms of mortar / day) * 22 days =
• 10560 foam blocks (176 cubic meters) + 12320 kilograms of mortar / month.

In order to find out the yearly resource consumption, the monthly amount needs to be multiplied by 9, and not 12, since stone masonry is typically not conducted during winter due to additional costs for labor and the necessity for specialized mortar and tools that can operate in a cold and wet environment (Hardin and McCool 82). Thus, the yearly resource consumption for 1 brigade is as follows:

• (10560 foam blocks (176 cubic meters) + 12320 kilograms of mortar / month) * 9 months = 95040 (1584 cubic meters) + 110880 kilograms of mortar.

This amount of resources is calculated assuming that every worker performs their duties at optimal efficiency. While such expectations are unrealistic to perform, the materials and resources that are to be available for the brigade are supposed to accommodate such a turn of events.

The required tools for one brigade include (Hardin and McCool 92):

• 1 mortar mixer
• 2 large shovels
• 12 masonry toolkits (4 used at once, will need to be replaced on a 3-month basis due to damage from extensive use)
• Ropes, nails, saws, and other associated items that will not be necessary on a daily basis, but might be required on occasion.

Financial Resources

Typically, all financial matters in a construction organization are handled by the supply department that oversees all of the necessary purchases to ensure that the construction process is not interrupted by material shortages. Assuming that I will be required to calculate the expenditures for my brigade, there are several positions that need to be taken into account. These positions are:

• Salaries of 4 stone masons and 2 general workers
• Costs of tools and materials

Stonemasons and general workers are typically paid by the hour. In the USA, an average stone mason is paid 20 dollars per hour, while general workers  10 dollars per hour (Hardin and McCool 110). So, the monthly salary budget for a brigade is calculated as follows:

• 20$/hour * 8 hours * 22 + 10$/hour * 8 * 22 = 5280 dollars / month

Yearly salary budget is calculated as follows:

• 5280 dollars / month * 9 months = 47520 dollars

The following values are calculated without expectations for sick leaves or holidays, as the surplus has to accommodate the perfect scenario. At the end of the month, all extra money is returned to the company and utilized as part of the budget for the next year.

In order to create a material budget, the manager needs to calculate the costs of material used in construction, which includes mortar, foam blocks, and tools. Tools make a minor part of the budget. Material costs are calculated as follows:

• Mortar (monthly) = 12.32 tons * 110 dollars / ton = 1355 dollars (Cement Prices).
• Mortar (yearly) = 1355 dollars / month * 9 months = 12195 dollars.
• Foam blocks (monthly) = 176 cubic meters * 130$ / cubic meter = 22880 dollars (Rodrigues).
• Foam blocks (yearly) = 22880 dollars / month * 9 = 205920 dollars.
• Tools (yearly) = circa 1000 dollars a year.

Supply Sources

In a construction company, human resources are supplied from an external labor market, while material resources are provided by a number of producers and vendors. Foreign suppliers and workers typically have the advantage of price over their domestic US counterparts. For example, Chinese-produced materials have the advantage of access to cheap production facilities, which allows the vendors to reduce prices.

However, this comes with certain risks. Shipments of large quantities of materials overseas would require large storage facilities and transportation expenses. Workers, on the other hand, are to be hired domestically, as hiring masons from other countries would pose certain problems related to language, understanding, quality standards, and travel issues. The standard procedure for requesting and receiving resources and supplies goes like this (Harris and McCaffer 198):

• The brigadier manager identifies a need for specific resources or tools.
• The brigadier manager approaches the supply manager and makes a formal request for said resources and tools, specifying the reason for the request as well as the estimated quantity of the resources.
• The supply manager verifies the request and contacts the suppliers or the warehouse in order to dispatch the requested amount of resources.
• Upon the delivery of the resources to the construction site, the supply manager signs the delivery note provided by the supplier.
• The materials and resources are then transferred to the brigade, and the brigadier manager signs the acceptance note provided by the supply manager.

The purpose of this system is to ensure that in the event of a mistake in delivery documentation, resource theft, damage, or non-delivery, the responsible parties are quickly found. This procedure is very important, especially when dealing with foreign suppliers, since, in case of documentation mistake or non-delivery, another shipment may take weeks if not months to arrive, which could potentially affect the construction process.

In order to acquire human resources, however, the manager has to work in close relation with the companys HR managers, since the task will be delegated to them. As a brigadier, I will be required to outline the required competencies of a potential candidate for the job as well as various physic-psychological qualities, if necessary. In this scenario, should I require a stone mason, I would need to specify their skill cap.

For working with foam blocks, no unusual skills are required. General workers will not have any specific demands towards them, as they will be tasked with unskilled manual labor. However, any experience in construction work operations would be welcome, especially stone masonry-related expertise. That way, in the event of one stone mason taking sick leave, a general worker may have the potential of temporary replacing them when performing non-crucial tasks. While the mortar mixer requires 2 people for optimal efficiency, it can be realistically manned by 1 person (Hardin and McCool 92).

Contingency Arrangements

There are several types of resource contingencies associated with construction work. They are (Walker 255):

• Worker sick leave (human resource contingency).
• Worker incompetency (human resource contingency).
• Resource and material shortage (material resource contingency).
• Force majeure events (human and material resource contingency).

Worker sick leave is the most common type of contingency. People who work outdoors are much more exposed to becoming sick, especially in autumn and spring, when the weather is relatively cold, and rains are a common occurrence. While it is uncharacteristic for employees to be sick all the time, it is possible for one or two of them taking several days off in a year for sick leave. My contingency plan would account for these events, and the monthly production and resource plans would be adjusted to expect results slightly lower than optimal.

Worker incompetency is a problem often encountered when hiring foreign labor. Different countries have different standards and practices in construction. A worker hired from Mexico may be regarded as competent at home, but have no idea of US construction standards and practices. Labor is best sought after domestically. US construction workers, while demanding better pay, are typically more skillful and easier to communicate with. In addition, their employment is less likely to be associated with any legal problems (Walker 258).

Resource and material shortage are also a common occurrence in construction. Most construction sites tend to implement lean management techniques, delivering materials to the site only when they are required. This helps save storage space and not clutter the construction site with materials, which could be damaged or stolen. However, in order to avoid pauses in production, the construction site should have a small storage facility to house foam blocks and mortar in order to provide supplies in the event of a shortage.

It is reasonable to buy construction materials from abroad. Many foreign companies are orienting for the US construction market and provide materials that comply with US regulations and standards, at a lower price. Mortar and foam blocks do not require any specialized storage facilities. Therefore, warehousing expenses would be minimal, and they can be purchased in large quantities (Walker 259).

At the same time, this strategy will eliminate the chances of remaining out of stock, due to having purchased a large surplus shipment. Reasons for supply shortages could be numerous. In the majority of cases, short-term supply shortages are caused by logistic failures and delays. Trucks often get stuck in traffic jams, especially if the construction site is located deep inside a city. It is possible, however, for suppliers to neglect their contracts as well.

Force majeure events are devastating contingencies that are completely outside of a managers control. These contingencies include fires, floods, earthquakes, and other similar events. Some of these events can cause irreparable damage to the construction site. A manager can plan for potential force majeure events by utilizing fire safety measures, flood safety measures, and building according to high construction standards according to the engineering project, which is supposed to take these circumstances into account (Walker 260).

Recording Resource Use

Typically, when performing estimations of forecasted resource requirements versus actual resource requirements, the forecasted amount of resources tends to be larger than the actual amount of resources used. This is made with a purpose of creating a safety surplus in the event of a resource-associated contingency. In stone masonry, work is quantified in cubic meters of laid masonry. Since every block has specific measurements, it is relatively easy to calculate the volume of work performed by an individual worker or a brigade. Engineering projects utilize this method to identify the exact number of building blocks needed to build a wall or a barrier within an apartment.

Thus, the end amount of work necessary to perform is always precise. However, calculating average performance rates in order to estimate resource consumption is more difficult. To perform the calculations, we used a value of 2 cubic meters of foam blocks per mason per day. However, this number is not absolute and can be negatively affected by various factors, such as inexperience, poor working practices, bad weather, errors and discrepancies between projected and actual volumes of work, etc (Frank and McCaffer 161). Recording and monitoring actual progress, thus, is paramount.

At the end of each work shift, the brigadier manager is supposed to review and record the amount of resources used, estimate the amount of work completed, and project resource consumption for the next day. These estimations are to be taken to the supply manager, who will be supposed to prepare the necessary resources to be allocated for the next day. There are two methods of assessing resource spending.

The first method involves direct calculation of the resources being spent, which involves counting the number of blocks, mortar, and other consumables used to complete the project. The other method involves a degree of assumption, which is usually attributed to the use of tools, who have a certain life expectancy that is used in calculations and predictions (Frank and McCaffer 171). The actual realities in regards to particular tools vary and are dependent on the amount of maintenance and care, as well as an absence of work-related accidents. A working accident or a defect can significantly reduce the equipments service time, which makes tool service rates harder to estimate, report, and predict.

Predicting human resource exhaustion is even harder due to the fact that moral and physical resources of employees are not easily quantifiable (Frank and McCaffer 172). Typically, human resource exhaustion is reported post-factum, when an employee quits or is forced to take sick leave.

The information in regards to projected performance and resource consumption versus actual resource consumption can be used to adjust predictions for the future. That way, forecasting could be tailored to a particular construction site or a worker brigade, which would enable the project managers to provide the necessary amounts of resources without risking resource supply failures or overconsumption (Walker 49). Despite the common practice of using a safety surplus in construction, that surplus is not supposed to be too large, as it is money that the construction company could have otherwise used productively.

Works Cited

Cement prices in the United States from 2007 to 2016 (in U.S. dollars per metric ton). Statista, 2017.

Company Overview of Bechtel Group, Inc. Bloomberg. 2017. Web.

Hardin, Brad and Dave McCool. BIM and Construction Methods: Proven Tools, Methods, and Workflows. Cybex, 2015.

Harris, Frank and Ronald McCaffer. Modern Construction Management. 7th ed., Wiley-Blackwell, 2013.

Rodrigues, Juan. What is and When to Use Autoclaved Aerated Concrete (AAC). The Balance. 2016.

Walker, Anthony. Project Management in Construction. 6th ed., Wiley-Blackwell, 2015.

Introduction

Stimulating employees to work effectively with the necessary level of dedication is one of the most significant areas of activity for managers whose business is based on using the workforce. Implementing the necessary strategies to increase motivation, creating sustainable systems of control over diligence, and similar organizational tasks form a range of impacts that leaders of companies promote.

One of the objectively important areas of subordinates work is their productivity that is not a static phenomenon and is largely influenced by external impacts. In order to demonstrate the current algorithm for implementing a plan to increase employee productivity as part of human resource development (HRD), Enterprise Rent-A-Car will be utilized.

This organization has branches in different countries, and its international activity is one of the topical reasons explaining the need to create a stable system of control over subordinates performance and their interest in achieving high production results. Promoting an HRD plan based on increasing productivity indicators can enable the company to enhance its operating results and bring the management closer to employees by introducing relevant solutions and developing the principles of interacting with employees.

Overview of the Subject Company

Enterprise Rent-A-Car is selected as one of the successful participants in the rental car market. A large staff is one of the features of the organization because, as Busse, Swinkels, and Merkley (2017) note, the corporation has been operating since 1957, and in 2010, there were more than 6,000 locations providing rental cars in the USA (p. 1). In addition, the company has many branches in the world, including European countries, and such success is the result of competitive promotion over several decades. During its work, Enterprise Rent-A-Car has developed not only car rental strategies but also advanced car sales systems, commercial project management practices, and mechanisms for working with cars of different sizes and purposes.

The company has evolved from a small firm into a large international network that provides services in different parts of the world and generates profit through advanced competitive strategies and high-quality management. The activity of Enterprise Rent-A-Car proves that the creation of a sustainable business is possible in the conditions of the monopolization of the market and competent work in the area that is narrow-profile and requires a professional approach to organizing sales procedures.

In view of the extensive activities of the company in question and its work in the international market, addressing issues related to personnel management is crucial. According to Mangan (2019), more than 100,000 employees are involved in the global holding, and this figure is a good reason to develop and implement a sustainable HR policy. Despite the fact that the corporate profits are growing steadily, such a parameter as productivity is of high importance in the context of achieving goals. In this regard, working on this criterion is of great importance in the framework of personnel management and, in particular, maintaining the high motivation of subordinates to implement the work plan.

Enterprise Rent-A-Car interacts with different market segments and, as Mangan (2019) remarks, collaborates with the authorities at the local and national levels. In this regard, maintaining a high quality of services is mandatory, and performance management as one of the aspects of monitoring subordinates activities is a relevant area for optimizing and implementing ideas planned as basic strategic development steps. Introduction the appropriate methods of interaction with employees may help maintain the high positions that Enterprise Rent-A-Car occupies now.

Assessment of the HRD Opportunity

Since an intervention based on improving performance management is planned as the chosen HRD opportunity, it is essential to consider the features of this practice and its role in the proposed company. Addressing issues related to monitoring subordinates productivity is mandatory and should be maintained in any business enterprise. In case a certain organization carries out activities not only within a separate location, for instance, at the national or international level, evaluating contributes to analyzing the existing approaches to personnel management and introducing relevant changes.

According to Harris, Wang, and Wang (2015), in the field of transport in which Enterprise Rent-A-Car operates, the security and stability of the entire algorithm of interaction between managers and employees are often ensured by utilizing digital resources, for instance, smart reporting systems. At the same time, work in a given direction allows not only improving the quality of the services provided by the company but also implementing a number of other crucial interventions. In Figure 1, possible implications of introducing performance management optimization practices are shown where such aspects are addressed as talent management, staff benefits, and some other possibilities (Performance management framework, 2019).

As a result, when following the chosen performance management strategy, leaders have the opportunity to realize the companys final plans and missions through subordinates productivity enhanced due to dedication and sufficient diligence. Sabir (2017) notes employees high motivation as one of the main drivers of successful innovations and argues that personnel management is a multi-stage process where controlling operational results is one of the stages in addition to such aspects as conflict management, integration, the promotion of cultural and ethical standards, and others.

Nevertheless, while considering the activities of Enterprise Rent-A-Car, one can note that the market success of the corporation is largely due to its high pace of work and promotion in new markets, which is achieved through employees participation and their skilled labor. Accordingly, the introduction of an appropriate strategy for involving subordinates and stimulating their productive activities may have a positive effect not only on production results but also on the quality of interaction between leaders and employees. Therefore, creating a sustainable strategy for optimizing the current operating mode in order to increase the staff motivation of Enterprise Rent-A-Car may have many valuable implications from different perspectives.

When evaluating the significance of the proposed HRD strategy in relation to Enterprise Rent-A-Car, one can note that a performance management system based on the use of modern control principles can reveal barriers that hinder market promotion. As Harris et al. (2019) state, technological developments aimed at improving operational productivity have important analytical functions that examine all the performance criteria and identify the weakest areas. Enterprise Rent-A-Car executives can utilize this information to their advantage, making necessary reorganization changes and implementing those strategies that will be aimed at overcoming the problems and gaps identified.

Through a comprehensive performance assessment, corporate leaders are able to obtain a comprehensive picture of the success of individual departments and the contribution of employees. Thus, productivity management may have undeniable advantages for such a large organization as Enterprise Rent-A-Car. In addition to improving the quality of immediate duties performed by subordinates, such aspects can be improved as professional motivation and the level of the corporate culture. These factors are crucial criteria, and addressing them along with the designated area may help the company to increase its assets and expand the sphere of influence.

Design of the HRD Plan

The work plan aimed at enhancing productivity management in Enterprise Rent-A-Car implies developing a special program involving digital analytical equipment to evaluate the current productivity of subordinates and assess possible optimization methods. In Figure 2, the stages of such activity are displayed, and judging by the scheme, for each of the phases, careful monitoring and evaluation are necessary to implement the program as efficiently as possible (A training cycle based on an HRD plan, 2018). As a basic strategy, increasing staff motivation is considered one of the most effective tools to strengthen employees dedication to the company and enhance their responsibility for the assigned tasks as per the corporations missions.

Since performance management correlates with resource management, an appropriate asset allocation strategy needs to be developed. Lazov (2017) notes that for car rental enterprises, resource management is one of the key areas that should be maintained because such aspects as service security, a stable customer base, and other factors of a successful business depend on how advanced a resource base is. Accordingly, one of the first phases of work to strengthen productivity management in Enterprise Rent-A-Car is to modernize the system of control over the consumption of material resources and evaluation activities, involving the analysis of possible optimization methods.

Following the analysis of the system of resource expenditure and distributions, determining subordinates motivation is necessary in order to reveal the degree of employee satisfaction with the current working conditions in the company. As Verbeeten and Speklé (2015) note, the task of team leaders is to determine which particular incentives are the most effective in the context of influencing the dedication of colleagues and their willingness to make every effort to achieve their goals. This stage is one of the most important because those stimuli offered as motivators make it possible to influence subordinates to the greatest extent, unlike other methods of impact.

As an auxiliary tool, introducing a digital analytical system can be a valuable step for determining performance parameters and comparing indicators. This stage is not extremely important because, according to Verbeeten and Speklé (2015), the task of managers is to find not the mechanisms of influence but the professional power of convincing subordinates to work better and more efficiently. Nevertheless, a special program may be helpful as auxiliary equipment that allows calculating all the necessary results of operational activities accurately, excluding the human factor during the calculations and, thereby, minimizing potential errors.

The two subsequent and final stages are evaluative and are intended exclusively for managers. It is not enough to simply propose changes and give subordinates an opportunity to work in new conditions; therefore, control over the updated regime is mandatory. At this stage, managers should ensure that all the changes are implemented correctly, and all subordinates are ready to realize their professional potential. The last stage is related to the assessment that needs to be done after relevant reorganizational amendments. In order to understand whether employees have managed to increase their productivity indicators, managers should analyze recent and past data and draw conclusions based on comparisons.

In case productivity becomes higher, the proposed intervention program proves its effectiveness and may be introduced as a valuable intervention strategy. Lazov (2017) states that the competitive environment of car rental companies requires a stable system of profit-making, which, in turn, is possible only if effective HR strategies are introduced, which encourage subordinates to work productively. Therefore, the proposed plan based on stimulating the interest and motivation of Enterprise Rent-A-Cars employees touches on the main impact methods and includes the following intervention steps:

1. Conducting resource management activities.
2. Determining subordinates motivation and satisfaction.
3. Introducing a digital analytical system monitoring performance results.
4. Controlling employees work in the updated model of operation.
5. Assessing and analyzing the sustainability of changes.

Implementation Strategy

The implementation of a performance improvement strategy based on the aforementioned steps and operating principles should be phased. According to Werner (2017), in the service industry, employees use the power of digital technology to track productivity and control progress based on real-time data. Such a mechanism of engaging innovative tools is an effective method that contributes to eliminating errors caused by incorrect interpretation and implementing the necessary interventions as efficiently as possible. In addition, Werner (2017) notes that performance management provides for the introduction of special appraisal systems that serve as the drivers of changes and are the integral attributes of activities that require incentives for higher production results.

Therefore, a key strategy for introducing amendments aimed at increasing productivity is associated with the use of motivational incentives designed to increase the productivity of ongoing tasks in Enterprise Rent-A-Car. In Figure 3, the basic elements influencing employees motivation are identified, and in accordance with these drivers, one can assume that the individual role of subordinates in an organization is significant and directly affects the degree of dedication and responsibility (Drivers of motivation, 2016).

In order to implement the proposed change plan successfully, it is crucial to create the necessary conditions for subordinates work and not only require increased productivity but also stimulate production achievements. Since the company in question provides car rental services, the corporation management should provide employees with an opportunity to hone their skills in the chosen field since the criterion of mastery is one of the motivational drivers.

Organizing advanced training courses, engaging foreign colleagues to exchange experiences, and other educational steps can increase the competence of subordinates in their field of activity, thereby enhancing their confidence in their individual importance for the company. Tens of thousands of Enterprise Rent-A-Cars employees all over the world should understand why they are specialists in the corporation and what benefits they bring to achieve the set goals.

As Boltze and Tuan (2016) argue, economic productivity is enhanced by the competent implementation of tasks with the minimum amount of resources. Therefore, one of the tasks of educational activities is to train personnel to allocate available resources efficiently, and the experience of colleagues from different branches may be combined to draw up an optimal strategy.

The autonomy and purpose as the components of a motivational strategy also need to be addressed in the intervention program. In this context, Boltze and Tuan (2016) propose to pay attention to an individual value system and implement the tactics of changes not only to increase employee productivity but also to strengthen their motivation by encouraging. Such a method may involve various incentives, and both material initiatives implying bonuses and financial rewards and other advantages may be affected, for instance, career advancement. If Enterprise Rent-A-Cars employees are aware of their roles and understand the importance of the functions they perform, this will have a positive effect on productivity.

Therefore, the performance management strategy intersects with employee engagement and is the practice that means establishing close contact between leaders and subordinates. Thus, the implementation strategy based on increasing the motivation of the companys personnel can help achieve positive results, and using the accompanying methods of influence, for instance, introducing a digital control mechanism, may contribute to more productive work.

Delivery

Based on the presented intervention strategy, the delivery of changes to Enterprise Rent-A-Car will occur in stages, and the entire program involves the close contact of the management with subordinates. To begin with, resource management tactics need to be introduced in order to examine possible gaps in the availability of assets and, if possible, minimize costs. According to West and Blackman (2015), meeting leadership requirements for cost reduction may be achieved through the preparation of a plan and preliminary analytical calculations involving the evaluation of the funds distribution to address specific tasks. Within the framework of the company in question, this procedure can be carried out by using a smart program for calculating profits and expenses for basic operations performed by employees.

The implementation of the stage of increasing employees motivation and satisfaction is also one of the phases. The system of bonuses accrued for effective and professional work is the practice that may be implemented in Enterprise Rent-A-Car as part of the local corporate culture. As Richards, Yeoh, Chong, and Popovi
(2019) note, targeting this mission are one of the most significant initiatives that employees value, and staff engagement can take place either individually or in groups.

The senior management receives reports from department leaders who, in turn, establish a mechanism of productive interaction with colleagues and stimulate them to increase production outcomes. Such components as autonomy, mastery, and purpose are affected through the provision of training opportunities, the manifestations of initiatives, and the prospects for professional growth, for instance, by involving subordinates in the joint decision-making process.

The stage of introducing a digital analytical system monitoring performance results may be realized by developing and implementing the necessary software that controls all the operational activities of employees and displays changes in their labor indicators. Richards et al. (2019) argue that such programs can not only simplify the decision-making process but also stimulate workers productivity due to the error-free interpretation of their activity.

This means that subordinates will not be able to evade responsibility for immediate duties, and bonuses accrued for effective activities for the good of the company will be calculated based on the results presented in the digital program. The management should prepare a team of employees who will be responsible for maintaining such an application and monitor its smooth operation. All the reports received during the analysis will be evaluated on the basis of comparison, and in accordance with the results of this assessment, conclusions will be made regarding the impact of relevant motivational strategies on employee productivity.

Finally, the last two stages of work, which need to be implemented after introducing relevant initiatives, are the monitoring of the programs effectiveness and its evaluation using the necessary assessment tools. The only prospect that may prove the efficiency of the project is an improvement in subordinates performance compared with the results before the intervention. As a control tool, West and Blackman (2015) suggest using the aforementioned digital tools, reflecting subtotals.

The Enterprise Rent-A-Car management should meet with department heads and receive regular reports on the activities done and the results of the updated work schedule. In case the proposed changes justify their relevance, this will become an additional incentive for developing additional optimization strategies, for instance, promoting recruitment programs and methods for retaining talented employees to increase the companys competitiveness in the market. All of these solutions may be the result of the successful change program aimed at increasing performance.

Method of Evaluation

The method of evaluating the implemented changes aimed at improving performance management in Enterprise Rent-A-Car, the comparative principle of the correlation of the results will be applied. As an effective tool that may help assess the quality of the proposed optimization solutions as part of employee productivity improvement activities, Nguyen, Mia, Winata, and Chong (2017) suggest utilizing a special management control system (MCS). According to the authors, the value of this program lies in the fact that it allows the management to realize two essential goals  decision-influencing and decision-facilitating (Nguyen et al., 2017, p. 202).

Both aspects are of high importance in the framework of work involving control over the updated activity because leaders get an opportunity to not only evaluate the success of specific interventions but also coordinate all operational processes, thereby preventing a decrease in productivity. The comparison method is the main methodology since performance parameters are a dynamic variable, and the correlation of the results of subordinates work at different stages contributes to determining the advantages and disadvantages of the proposed intervention objectively.

In addition to the aforementioned advantages, using MCS as a key assessment methodology allows evaluating the proposed changes in their quality not only practically but also theoretically. According to Punt, Butterworth, de Moor, De Oliveira, and Haddon (2016), such a program makes it possible to create proportional correlations and serves as an effective decision-making tool, which eliminates the need for managers to take risks and apply unverified intervention steps. In addition, as the authors remark, employees themselves can monitor their production results, which is a valuable incentive and driver for improving personal performance (Punt et al., 2016).

The staff servicing such a system can set up a mode of displaying subtotals, which is convenient for the management and helps improve perception, thereby allowing leaders to focus on the whole picture and assess the current changes comprehensively. As a result, for car rental companies and, in particular, Enterprise Rent-A-Car, such a mechanism can be useful as a universal algorithm for comparing employee productivity based on the assessment of their initial and final indicators, for instance, the number of grateful customers, the total amount of activities performed, and other activities.

The proposed assessment method is a convenient and uncomplicated technique that allows detecting any gaps in terms of the intervention and eliminating them timely. In general, the practice aimed at strengthening performance management in Enterprise Rent-A-Car with an emphasis on employee motivation and introducing specialized software is valuable and useful, but some ambiguous nuances and limitations may arise. In Table 1, possible advantages and constraints for the proposed strategy are presented.

Table 1. Advantages and Limitations of the HRD Plan.

Given these limitations, the Enterprise Rent-A-Car management should do everything possible to prevent crucial problems. Close interaction with subordinates may help convey the significance of common goals and the importance of the participation of each employee in their achievement. To minimize competition, an objective bonus system should be proposed so that colleagues could not conflict over premiums. A limited range of tasks is not a significant limitation, and in the case of the competent implementation of the strategy, specific aspects of work, for instance, labor efficiency, may increase.

Conclusion

Implementing the plan aimed at improving the quality of performance management in Enterprise Rent-A-Car can optimize the companys operational processes and improve the interaction of the management with subordinates. The corporation has branches in different countries, and its large number of workers is the reason for developing strategies to enhance productivity. As the effective mechanisms of influence, motivational incentives need to be presented, as well as the system of the digital assessment of employees activities. The intervention plan can go through several stages and end with the evaluation of the proposed changes.

This HRD strategy has different advantages, but some restrictions may appear. The management of Enterprise Rent-A-Car needs to constantly monitor subordinates work in order to prevent conflicts caused by competition and ensure a favorable working environment.

References

Boltze, M., & Tuan, V. A. (2016). Approaches to achieving sustainability in traffic management. Procedia Engineering, 142, 205-212. Web.

Busse, M., Swinkels, J., & Merkley, G. (2017). Enterprise Rent-A-Car. Kellogg School of Management Cases, 1-15. Web.

Drivers of motivation. (2016). Web.

Harris, I., Wang, Y., & Wang, H. (2015). ICT in multimodal transport and technological trends: Unleashing potential for the future. International Journal of Production Economics, 159, 88-103. Web.

Lazov, I. (2017). Profit management of car rental companies. European Journal of Operational Research, 258(1), 307-314. Web.

Mangan, M. (2019). Public transportation, private enterprise. Institute of Transportation Engineers. ITE Journal, 89(6), 18-19.

Nguyen, T. T., Mia, L., Winata, L., & Chong, V. K. (2017). Effect of transformational-leadership style and management control system on managerial performance. Journal of Business Research, 70, 202-213. Web.

Performance management framework. (2019). Web.

Punt, A. E., Butterworth, D. S., de Moor, C. L., De Oliveira, J. A., & Haddon, M. (2016). Management strategy evaluation: Best practices. Fish and Fisheries, 17(2), 303-334. Web.

Richards, G., Yeoh, W., Chong, A. Y. L., & Popovi
, A. (2019). Business intelligence effectiveness and corporate performance management: An empirical analysis. Journal of Computer Information Systems, 59(2), 188-196. Web.

Sabir, A. (2017). Motivation: Outstanding way to promote productivity in employees. American Journal of Management Science and Engineering, 2(3), 35-40. Web.

A training cycle based on an HRD plan. (2018). Web.

Verbeeten, F. H., & Speklé, R. F. (2015). Management control, results-oriented culture and public sector performance: Empirical evidence on new public management. Organization Studies, 36(7), 953-978. Web.

Werner, J. M. (2017). Human resource development, talent management (7th ed.). Mason, OH: Cengage Learning.

West, D., & Blackman, D. (2015). Performance management in the public sector. Australian Journal of Public Administration, 74(1), 73-81. Web.

Could the implementation of the main principles of the TQM result in the significant increase of the level of performance of a company and its incomes?

Nowadays, in terms of severe rivalry, UPS company tries to implement the strategy that will be able to guarantee its success and gradual improvement of the quality of companys products and services. That is why, today the company works in accordance with the main principles of the Total quality approach. There are several main reasons for this choice. The first obvious reason is that being the worlds greatest franchisor of retail shipping and business centers, the company needs constant development and improvement in order to remain competitive and hold leading positions. TQM (Total Quality Management) implies the usage of various means and remedies in order to improve all spheres of activity of the company, which results in significant improvement of the level of performance, quality and efficiency of a company¹.

It should be said that the emphasis on the continuous and wise improvement of all kinds of activity, performed by the company, obviously helps UPS to save its image and continue growth. However, it is possible to admit that implementation of the main principles of the TQM becomes possible due to the promotion of top and other managers, who try to guarantee the improvement of the department which they head. In other words, it should be said that managers introduce and reward actions that are aimed at creating the positive image of a company and increasing the level of its performance². However, one can also admit that there is another benefit that results from the implementation of the main principles of the TQM.

The thing is that the staff of USP also becomes involved and masters its skills. Being the part of the process which is characterized by the continuous evolution and improvement, a worker is not able to remain steady and has to master his/her skills in order to be able to face new challenges which the company might face. Another peculiarity of the business model used by USP in its functioning is the thing that the interaction between a great number of various departments is perfectly aligned and the needed information could be delivered to a worker in a very short period of time.

It is obvious that it results in significant increase of the efficiency of a company and helps to get rid of extra bureaucracy Moreover, workers of a team are encouraged to perform their duties fast and efficient. Top managers understand that activity of these people influences the whole company and, that is why, deal a great attention to the development of staff and training. With this in mind, it is possible to conclude that the business model of the company is organized in accordance with the main principles of the TQM and helps it to function more efficiently.

The Case of UPS Store

It should be said that nowadays, a great number of companies, which were taken as beneficial ones, collapsed, though UPS Store continues its functioning and continues to remain beneficial. According to its annual report, in 2014 the total revenue was $58,232 million³. This sum can be taken as the evidence of the efficient functioning of a company and good perspectives that it has. The main strategy of the company lies in the continuation of its functioning in the given sphere and developing of services provided to its customers.

It should be said that nowadays the company has more than 2, 700 operating facilities and about 9.8 million customers⁴. It could be taken as the fact that shows the blistering progress of a company, that had been founded in 1907. Moreover, such a blistering development helped the company to increase its incomes significantly and in 2014 it adjusted net income increased 1.2 percent, to $4.39 billion on a 5 percent increase in revenue, to 58.2 billion⁵. It means that the companys performance is higher than average as it terms of world financial crisis it manages to improve its showings and increase the annual revenue.

Moreover, according to the latest strategic plans, the company aims at opening new departments that will be able to provide a job for a greater number of people and increase the level of incomes of UPS. According to these plans, UPS is going to make about 1$billion investment in Europe in order to expand the ground network capacity⁶. It is needed because of the blistering tempos of growth of the company which UPS experienced in the European region.

Intention to seize new areas and take on new markets could be taken as another evidence that shows the high level of the companys performance and also results in the increase of the level of trust towards the company. Additionally, the usage and implementation of various innovations like ORION⁷ in the process of functioning of a company could not but increase its efficiency and general performance. With this in mind, it is possible to acknowledge that the USP Store nowadays has stable showings which serve as the evidence of its efficient performance and great incomes that in their turn, promote further development of the company.

References

The UPS Store Difference. (n.d.). Web.

Thompson, A., Peteraf, M., Gamble, J. & Strickland III, J. (2013). Crafting & Executing Strategy: The Quest for Competitive Advantage: Concepts and Cases. New York: McGraw-Hill Education.

UPS. (2014). Networked for Growth. 2014 Annual report. Web.

Notes

1. The UPS Store Difference. (n.d.). Web.
2. Thompson, A., Peteraf, M., Gamble, J. & Strickland III, J. (2013). Crafting & Executing Strategy: The Quest for Competitive Advantage: Concepts and Cases. Ney York: McGraw-Hill Education.
3. UPS. (2014). Networked for Growth. 2014 Annual report. Web.
4. Ibid.
5. Ibid. p. 3.
6. Ibid.
7. Ibid.

Introduction

Most companies in the world of capitalism always want more. They want more profit, more shareholder value, and more market share, among others. The realizations of these objectives have been attained through the successful initiation, development and management of a variety of factors that include value chain management in most instances. Indeed, the effective development and management of customer value has become a major priority for all organizations of all sizes in the different industries and markets. The reasons for this are certainly clear; strong customer value management are positively correlated with customer loyalty and profits. However, the efficient management of customer value can present challenges, especially in the case where managers are unable to accurately evaluate and assess their value chain management in terms of particular strengths and weaknesses objectively.

One major limitation that has been presented in both academic and empirical literature is on how to deal with the multifaceted issue of products development and multi-channel branding, especially where there is the need for reliance on professional retail distributors engaged in the sale and distribution of competing products. The adoption value chain management has been advanced as presenting numerous challenges and implications to the marketing context, and thus enlarging the complexity of marketing decisions. This report analyzes a possible growth scenario for companies, namely market development in order to provide a theoretical and empirical conceptualization of how an organization can ultimately develop its products through effective and informed pursuit of the key constructs of value chain management and market performance as employed in value chain management strategies.

Value chain management

According to (Lawson, 2003), value chain management (VCM) is the integration of all resources starting with the vendor and integrate information, materials, labor, facilities, logistics, etc. into a time-responsive, capacity-managed solution that maximizes financial resources and minimizes waste. A whole cocktail of factors has been presented as forming the basis for the adoption of value chain management including costs reductions in transactions, reduced growths in demands, competitive strategies and differentiations, changes in customers behaviours among others (Lawson, 2003).

The questions of how to manage these in an integrated context has however been presented as presenting several challenges. This becomes especially poignant when the said retailers are professionals who are engaged in the sale and distribution of similar and/or competing products. The choices as to whether to rely on such competing distributors (retailers) differentiate the products or focus on products branding is a bottleneck facing majority of companies in the world today. This will essentially call for clear understanding and employment of key concepts and postulates of value chain management and the expected overall performance, in light of product development.

Customer value (value attributes)

Brand has been advanced as a fundamental part and parcel of customer value in competitive environment. In fact, it has been pointed at as the central reason behind the preference of a product over another. The generic value chain management for a brand have been advanced as either focus driven or value driven. The definition of a brand in this subtext will refer to as an identifiable product, service, person or a place, augmented in such a way that the buyer or user perceives relevant, unique added values that match their needs most closely (Chermatony and MacDonald, 2002). The maintenance of sustained value added attributes to be derived from a value chain management in the development of brand is in essence the key to competitiveness.

According to Kapferer (2003), brands are a direct consequence of the strategy of market segmentation and product differentiation. This point has been buttressed by Brassington and Pettit (2000) who have pointed out that branding act as a means of linking items within a product line or emphasising the individuality of product items. Other definitions have been advanced in literature but the key concurrence has been the emphasis on uniqueness and value provision to the customers in a more efficient manner. This in essence will give rise to competitiveness in the market or industry sector. As Fukuda (2003) has noted, the key to success lies in finding a competitive advantage that others find hard to copy or imitate. Indeed, academic and empirical literature is of the opinion that companies that develop brands with a strong customer franchise to be sufficiently insulated from any promotional strategies by the competitors. According to the author, this has been the reason why it makes sense for a supplier to invest heavily in order to create strong or even global recognition and preference for its brand name.

Several definitions of competitive advantage have been advanced in literature, but the most appropriate one in the context of this paper is the one presented by Grant (2003) who asserts that when two or more firms compete within the same market, one firm posses a competitive advantage over the rivals when it earns (or has the potential to earn) a persistently higher rate of profit. In essence, this means that a firm that outperforms the others in the primary goal of performance-profitability-has competitive advantage. A reference back to the branding generic model of firms can be made, where the question of whether firms are branding strategies is cost driven or value added arises.

According to Fukuda (2003), brands succeed because they are positioned to capitalize on their unique characteristics which, in one or more aspects, their rivals find hard to emulate and hence their competitive advantages. This competitive advantage gives it a basis for outperforming competitors because of the value that firms are able to present to the customers. According to Chermatony and MacDonald (2002) consumers may perceive value in brands when it costs less for them to buy as contrasted with competing brands offering similar benefits-costs driven benefits-and/or when they have unique benefits that offset their premium prices-value added brands. From an organizations point of view, the options presented are on whether to pursue a cost-driven or value-added competitive advantage in the support of either a broad or narrow approach to the target markets.

It has been demonstrated that there are four different quadrants within which a firm will devise its generic brand strategies. The focus on costs strategy ideally reflect a company whose success is entirely reliant on a set of clearly defined group of purchasers often at the expense of a focus on a much broader set. As Kapferer (2003) has noted, any temptations to add new features that may appeal to a closely group are resisted since the marginal gains incur significant costs. Broad cost branding appeals to a broad range of industries and are structured around the tenets of economies of scale (Chermatony and MacDonald, 2002). Broad differentiation on the other hand is focused on creating value for buyers and communicating this. In this regard, heavy costs are incurred in achieving a value added positioning and while attempts are made to hold down costs through more effective ways of production. Finally, the focus on differentiation is to a large extent addresses a particular group of clients and any products or services are strictly focused on the needs of this group.

From the above analysis, it can be adjudged that organizations can adopt two broad strategies by either focusing on costs driven or value added strategies in their branding initiatives both aimed at providing best value to customers. However, it should be noted that the choice on what strategy to adopt is dictated to a large extent by the strength of the particular brand. The assessment of a particular brands strengths or weakness has been carried out through the employment of Kellers brands report card, which has been pointed out as a useful tool in delineating the characteristics of winning brands in the world.

Keller (2000) has noted that most managers have the problem of being able to step back and assess their brands particular strengths and weaknesses. According to Keller (2000), ten characteristics are inherent in all of the worlds top brands and there is the need for managers to systematically assess how they can grade their brands performance against each of the ten characteristics. In this way, an organization can effectively delineate how the brand will perform in the market against the constraints of market dynamics and competition. By developing this report card, an organization can identify the areas that need improvements, the specifics where the brand is strong, and the particular brands configurations and hence the identification of the various brands strengths and weaknesses (Keller, 2000). Subsequent decisions on brands extensions, multi-branding or the development of new brands, and indeed the multi-channel branding choices can then be anchored on a fulcrum of informed basis.

One of the most important characteristic of a top brand is its ability to deliver the benefits that customers truly desire. According to Keller (2000), the reason why customers prefer a certain brand as opposed to another is because the collection of attributes, brand image, services, and the many other tangible and intangible factors create an attractive whole that customers truly desire and identify with. Another attribute is the relevance of the brands. In strong brands, brand equity is tied both to the actual quality of the product or service and to the various intangible factors. These attributes may encompass the user imagery, usage imagery, the type of personality the brand portrays, the feeling the brand tries to elicit in customers and the type of relationship it seeks to build in its customers (Keller, 2000).

Pricing

The pricing strategy is the next important attribute and should ideally be focused on the pursuit of a strategy that is based on customers perception of value. As has been noted in both academic and empirical literature, majority of organizations are faced with the problems of finding the right blends between the attributes of products quality, design, features, costs and prices. As noted by Keller (2000), many managers are usually averse to how price can and should relate to what customers thinks of a product and therefore either charge too much or too little for a product. How a brand is positioned in the market constitutes another important element. In most cases, brands are well positioned within the tenets of occupying particular niches in the customers minds (Keller, 2000). Keller has advised that most successful brands keep up with competitors by creating points of parity in those areas where competitors are tying to find an advantage while at the same time creating points of difference to achieve advantages over competitors in some other areas.

According to Grant (2003), selling brands should also be consistent and will entail striking a balance between continuity in marketing activities and the kind of change needed to stay relevant. In this regard, it is important that a brands image is never lost within the cacophony of marketing efforts that confuse customers through conflicting messages and inappropriate price fixing strategies (Grant, 2003). The pricing strategy and hierarchy should also make sense given that most companies may have several or different types of competition in the market. Maintaining sound boundaries becomes a crucial aspect here as overlapping two brands here may present untoward challenges.

Cycle-time responsiveness is the next customer value in chain management that entails the need for use of and coordination of a full repertoire of marketing activities in order to build the customer satisfaction. This is because timely products and services delivery mixes and matches helps perform a number of brand related functions, including but not limited to the enhancement or reinforcement of consumers awareness of brands and its image (Keller, 2000).

The next attribute is the need for managers to fully develop an understanding of chain wide resource optimization. Managers should appreciate the totality of all their resources and avoid restricting themselves to the traditional forms of resources but ensure optimal time and resource use for customer satisfaction. Such elements as the different perceptions, believes, attitudes, and behaviours customers associate with the brands whether created intentionally by the company or not can only be maximized to the benefits of a product through best practices in resource optimization within the chain wide business operations.

When an organization is confident about the customers likes and dislikes as well as the core attributes and associations that are interlinked with the brand, a well grounded framework can be ascertained as regards whether any given action will dovetail nicely with the brand or will result in conflicts. This will go hand in hand with the 9^th postulate that a brand is given proper support which is sustainable. This is because sustainability of all aspects of product brand enhancement cannot only be achieved through chain wide resource optimization. According to Keller (2000)

Realizing that the supply chain has more steps than existed in the traditional vertical model in which a single firm integrated many supply chain processes and functions within a single organization, the profit margins of each step have become smaller as firms became disintegrated in order to focus on one or only a few core competencies. An organization must monitor the sources of resources largely attained through good and frequent use of in-depth accounts audits and on-going brand tracking studies.

The building of a strong brand will entail maximizing on the above discussed issues. Thus, if a business is to excel in its ventures, it is of pre-emptive importance that the above factors are all considered and given the significance that they deserve. This will essentially entail paying cognizance to the constructs of value chain management that excel at delivering the benefits the customers truly desire, relevance, price strategy, brand positioning, brand consistency, brand portfolio, brand equity, brands understanding, proper brand support and finally, value chain management monitoring. These constructs can be employed towards the delineations of the value chain management in devising what better ways to customer satisfaction in the expected development and performance of a brand in a given market or industry setting. The choices to be made should conversely be reliant on an assessment of the value chain management strengths or weakness within the contexts of the widened markets or industrial frameworks. Customer value analysis is best achieved by the aspects of both quality and product factors as illustrated below.

Design Processes

The dynamics of changing demographics and consumer purchasing patterns, coupled with ever stronger competition, are putting increased pressure on businesses to adopt cutting edge technologies to meet the growing demands of the consumer in inventory management, capacity management, quality management and customer relationship management. This has impacted a lot on the in most businesses who have to devise new avenues for driving customer relations and develop distinct competencies that will ensure for their survival. Basically the adoption of these operations processes to meet customer values has brought with them a number of benefits both to the customers and the businesses banks. The scale of operations has improved, businesses have reported increases in the delivery of customer values and have also recorded decline in general costs.

In the analysis of the banking industry, customer relationship management through the application of advanced (CRM) tools has demonstrated commendable effectiveness. To facilitate them in realizing their objectives and missions, integrated IT solution called Customer Relationship Management (CRM) is finding a wide acceptance and application in many companies. Mathew, Cindy and Beatrize (1999), illustrate that to go a step further in the creation of added values, some banks are also taking in account their customers expectations and try to offer services which can help them increase their end service or product delivery

According to Mathew, Cindy and Beatrize (1999), customer relation management is a business philosophy that touches upon many independent parts of the organization. This business philosophy is one of the driving factors upon which the company success is based. In this endeavor, this business culture is inculcated in all the employees to ensure that the customer is not only satisfied but also retained. Mathew, Cindy and Beatrize (1999), further highlights that, to speed Customer acquisition, increase customer satisfaction and retention, and the company profit, it is necessary to develop a customer centric business model linking back and front office around the three pillars that are Sales, Marketing and Services

Available literature abides on the fact that to achieve an effective CRM, this IT solution needs to be technologically integrated in operation system of a bank. In addition, it requires constant customer repository to share information in sales, marketing and service departments in the company. The exploitations of economies of scale and scope were thought to be at the heart of dictating an industry structure characterized by concentration, centralization and adoption of new technologies. Banking services have not been left behind in their quest to satisfy the demands of the customer in the achievement of customer satisfaction and convenient online banking services. A general understanding on how firms can benefit from customer relationships remains critical for both the marketers and researchers. Prior literatures on the CRM banking have focused on the ability of banks to avail secure online services to the customers

Business organizations compete on the basis of price and quality. In this respect, the model of total quality management is particularly relevant in its emphasis on the interconnectedness between the different process chains in an organization. When it comes to the practice of total quality management, different departments have to coordinate their functions in order to achieve migration to the targeted changed state. For example, if the marketing department is planning to undertake customer relationship management programs, then it has to communicate its needs to the human resources department in order to develop the right training program for learning and growth. This calls for the strategic management of inventory, capacity and quality managements. Under the traditional management model, the marketing department might devise its own curriculum for the training program. Under total quality management however, human resource officials are also involved in the process. This involvement gives the human resources employees exposure to the marketing activities of strategic value. Therefore, this creates the basis for cross-functional training which equips human resource officials with skills of great strategic value to organizational competitiveness. Involving the human resource department in a wide variety of organizational activities is one of the means of transforming HR into a strategic, value adding function.

As mentioned before, the competitive advantage of an organization has to be sustainable in order for it to get any value out of it. The three generic strategies of differentiation, cost minimization and niche marketing do not have the ability to achieve sustainability because these strategies can be easily copied by competing organizations. Therefore, the source of the competitive advantage has to be long term and this is where the potential strategic value of HR comes in. It involves the taking of keen cognizance of the best practices in the management inventory, capacity and quality managements. The importance of managing human resources in order to create a sustainable competitive advantage stems from the fact that when the competitive advantage arises from certain elements of the organizational culture, it is sustainable because competing organizations cannot copy those elements in the short term. Building a certain organizational culture such as proper and leaner management practices in the inventory, capacity and quality managements is a long term process and it is the responsibility of HR managers to ensure that values, attitudes and beliefs that are the building blocks of that culture contribute to the strategic focus of the organization. In this respect, the central function of HR in maintaining an organizational culture aligned to the strategic focus of the company is one of the most critical aspects of the organizational processes.

Conclusion

The challenge involved in linking value chain management (VCM) to organizational development is to create a quantifiable framework for measuring impact, effectiveness and efficiency. The concept of measuring the impact of managing chain activities is comparable to that of measuring the return on investment of certain decisions in other areas such as marketing and finance. Measuring effectiveness is related to the extent that the actions and the capacities of employees in certain functions are affected by value chain management (VCM) programs Efficiency measures the level of value chain management activities that are attainable given a certain level of investment. Therefore, the challenge for the top management in transforming value chain management into a strategic, value-added function of organization development is to link the three concepts of impact, effectiveness and efficiency under the framework of organizational resources and processes. This adds value to the existing practices in marketing or finance by organizing the talent pools in each of these areas to maximize the value of resource constraints.

In other words, managing value chain adds strategic value to organization development. In order to develop a sustainable competitive advantage, organizations must combine value chain management (VCM) with organization development so that an effective framework for managing change can be developed. In the highly competitive world of todays business environment, the top leadership in a company must build an organizational structure that is built to last. This involves strategically aligned organization development. However organization development addresses only the structural issues of managing change. The human side must be addressed as well. Customer satisfaction and brand loyalty must remain the primary focus.

Poor inventory, quality and customer relationship management are the primary reasons behind the failures of most value chain management projects. In order to address this issue, the process of value chain management (VCM) must be brought into the strategic framework. Because of the fast changing business environment, organizations must maintain the process of managing change. It is in this context that the partnership between the various levels of management becomes feasible. The application of this partnership facilitates integration between business strategy and value chain management (VCM) strategy.

References

Brassington, F. and Pettitt, S. 2000. Principles of Marketing 2 edition. Essex: Pearson Education Limited.

Chernatony, L. and McDonald, M. 2002. Creating Powerful Brands: in Consumer, Service and Industrial Markets, 2 nd edition. Oxford: Butterworth- Heinemann.

FIA Forward Analytics, 2006. Customer Value Analysis. Web.

Fukuda, K. 2003. Effects of Brand Awareness on Choice for a Common, Repeat-Purchase Product. Journal of Consumer Research, 17: 141- 148.

Grant, R. 2003. Contemporary Strategy Analysis: concepts, techniques, applications, 4th edition. Oxford: Blackwell publishing.

Kapferer, J. (2003). Strategic Brand Management: creating and sustaining brand equity long term, 2 edition. London: Kogan Page

Keller, K.L 2000. Conceptualizing, Measuring, and Managing Customer-Based Brand Equity. Journal of Marketing, 57, 1-22.

Lawson, K. 2001. Commercials That Name Competing Brands. Journal of Advertising Research, 16: 7-14.

Mathew, W., Cindy, B. and Beatrize, K. 1999, Service Quality in the Banking Sector: The Impact of Technology on Service Delivery. William and Wilkins.

Introduction

Motivation is a critical factor affecting employees performance and organizational success overall. A successful performance management system builds on employee motivation to achieve better performance. The case of Nucor Steel is an excellent example of the use of work motivation theories in performance management. The company has become a significant player in the steel industry primarily due to the outstanding performance of its employees. Nucors application of motivation theories in performance management is manifested in two strategies. First of all, the company has a unique pay scheme, which energizes the workers, directs their behavior, and establishes equality throughout the company. Secondly, the coordination of performance management efforts across plants assists in fostering innovation and cooperation. The present paper will analyze how the two aspects of performance management at Nucor Steel build on motivation theories to achieve the desired effect.

Pay and Performance

The main aspect of performance management at Nucor Steel is its pay practices. According to Byrnes, the vast part of employees pay depends on their performance, as well as the companys success (57). Nucor Steel uses a system that ensures that high performance is fairly rewarded and poor performance is penalized. Byrnes explains that, whereas the average guaranteed pay per hour in most other steel companies is $16-$21, Nucor offers a guaranteed wage of $10 per hour, which can be tripled by bonuses tied to performance (58). However, if the quality of the product is poor, the workers lose their bonus and may be subject to a fine if the defective steel reaches the customer.

The second important factor in Nucor Steels strategy is that bonuses are determined based on the productivity of the entire shift, rather than for each worker individually. This helps to ensure cooperation among the workers and promotes the effectiveness of teams. Lastly, bonuses for performance apply both to the front-line workers and to the management. Managers get significant bonuses based on the plants return on assets, and all employees receive a one-time annual bonus if the company is performing well (Byrnes 58). All of these pay practices have helped Nucor to improve performance and increase its profits.

Nucors approach to mediating performance through pay is particularly notable due to its use of rewards. According to Kuranchie-Mensah and Amponsah-Tawiah, rewards are widely considered to be among the vital forces in improving motivation (256). The use of rewards and bonuses is justified by Herzbergs Two-Factor Theory, as well as the contemporary Expectancy Theory. According to Herzberg, recognition of efforts is among the motivating factors that increase job satisfaction and inspire workers to work more productively, whereas the salary itself is a hygiene factor that does not relate to motivation (Robbins and Judge 206). Therefore, Nucors strategy is to lower the base pay per hour while offering substantial rewards for high performance.

On the other hand, the Expectancy Theory states that employees will be motivated to exert a high level of effort when they believe it will lead to a good performance appraisal; that a good appraisal will lead to organizational rewards such as bonuses, salary increases, or promotions; and that the rewards will satisfy the employees personal goals (Robbins and Judge 224). Thus, to enhance employee motivation, the companies need to recognize employees efforts with rewards that will be meaningful to them. Nucors performance management system uses this mechanism in practice, thus translating employee motivation into higher performance.

Promoting equity within the organization is also a focus of some motivation theories. In particular, the Equity Theory states that employees compare the benefits received from a job correspond with efforts put into it; then, they contrast their ratio of benefits and efforts with those of other workers (Robbins and Judge 221). The highest level of motivation, according to this theory, can only be achieved if all employees are treated equally (Lee and Raschke 164). For example, if the managements salary is too high compared to the workers salary, workers will have low motivation. However, when pay disparities are minimal, the organization will benefit from enhanced motivation.

At Nucor, pay disparities are considerably lower than in most other companies in the industry, which, by the Equity Theory, promotes better performance by improving motivation. Moreover, the company fights inequity by using similar pay practices for managers and front-line workers. When both the workers and the managers income depends on plant performance, employees are less likely to have feelings of inequity. Thus, this aspect of Nucors performance management system diminishes inequity throughout the organization, relating motivation to performance outcomes.

Performance Management across Plants

Nucors approach to performance management across plants is also built on motivation theory, which is why it contributes to organizational success. As noted by Byrnes, while the plants cooperate with one another to reach performance goals and enhance work practices, there is also a share of competition to perform better than the other facilities (62). Indeed, all facilities work towards a shared goal of improving the financial performance of the organization, which is why they share ideas and experience for enhancing productivity. However, workers of individual facilities are also motivated by financial rewards and bonuses, which creates a competitive spirit. The most efficient facility is used for benchmarking, thus allowing other plants to improve.

There are two aspects of plant performance management that are critical to the success of Nucor. First of all, it allows setting clear goals and maintaining a healthy level of competition within the organization. These have a substantial effect on employee motivation, which is explained by the Goal-Setting theory. According to this motivation theory, clear and challenging goals stimulate motivation in employees by helping them to focus and remain energized (Robbins and Judge 212). While internal competition contributes to goal-setting, it is also a powerful motivation tool that can be used independently. Naidoo and Sutherland found that internal competition facilitates motivation, improves task effectiveness, and fosters a favorable organizational climate (77). This, in turn, has a positive effect on performance outputs, thus translating employee motivation into improved performance.

Secondly, Nucors approach to managing plant performance fosters cooperation and innovation. While plants compete to deliver the best possible results, they are still working towards a shared goal. Thus, plants share practices and tools for improving efficiency and enhancing performance. According to a study by Chen et al., fostering innovation in working teams supports a positive link between employee motivation and team performance (1018). Thus, Nucors approach to promoting innovation through collaboration and goal-setting also contributes to the positive effect of motivation on employee performance.

Conclusion

Nucors use of motivation theories offers an example of how evidence-based approaches to motivation can help organizations to achieve excellent performance outcomes. For instance, the companys use of rewards is consistent with Herzbergs Two-Factor Theory and the modern Expectancy Theory. Thus, rewards provided by Nucor energize employees and direct their behavior, achieving improved performance. Reduced pay disparities, on the other hand, are consistent with the Equity Theory. They help to reduce feelings of inequity while also increasing motivation. Finally, Nucors plant performance management plan aims to set clear goals, thus fostering innovation and collaboration. Overall, the strategies used by Nucor are effective in translating motivation into performance.

Works Cited

Byrnes, Nanette. The Art of Motivation. Business Week, 2006, pp. 57-62.

Chen, Gilad, et al. Teams as Innovative Systems: Multilevel Motivational Antecedents of Innovation in R&D Teams. Journal of Applied Psychology, vol. 98, no. 6, 2013, pp. 1018-1027.

Kuranchie-Mensah, Elizabeth Boye, and Kwesi Amponsah-Tawiah.  Employee Motivation and Work Performance: A Comparative Study of Mining Companies in Ghana. Journal of Industrial Engineering and Management, vol. 9, no. 2, 2016, pp. 255-309.

Lee, Michael T., and Robyn L. Raschke.  Understanding Employee Motivation and Organizational Performance: Arguments for a Set-Theoretic Approach. Journal of Innovation & Knowledge, vol. 1, no. 3, 2016, pp. 162-169.

Naidoo, S., and Margaret Sutherland.  A Management Dilemma: Positioning Employees for Internal Competition versus Internal Collaboration. Is Coopetition Possible? South African Journal of Business Management, vol. 47, no. 1, 2016, pp. 75-87.

Robbins, Stephen P., and Timothy A. Judge. Organizational Behavior. 15th ed., Pearson, 2013.

Operation management is a business area whereby a business is concerned with the production of goods and services. It makes sure that business processes are very efficient i.e. using fewer resources as required and effective in regards to meeting customers requirements. The ten decisions of operation management are very crucial in ensuring that the business meets its customer requirements (Nigel & Chambers, 2007).

In all the chains of its businesses, Hard Rock Cafe thinks about developing products and providing services that meet the specific need of its customers. Thus, for example, Hard Rock Café keeps on modifying its menu from classic burgers to high-end items to satisfy its customers. The use of technology i.e. websites and television programs has also improved service delivery to their esteemed customers (Meissner, 2010).

Hard Rock Cafe takes quality management as its highest goal, they are able to achieve this through continuous improvement of their products and services. On regular basis, Hard Rock Café carries out surveys and a scale, that helps in evaluating the quality of products and services.

Due to changes in peoples lifestyles and market needs, Hard Rock Café is required to be flexible to meet the needs of its customers. They are able to attain this through modification of the menu and diversifying their business to meet all the demands of the customers. Also incorporating technology into the business has boosted service delivery.

As a global power, Hard Rock Café operates in over 40 locations with headquarter in Orlando, Florida. Its location has enabled the café to offer services and products to Orlando universal studio a tourist destination.

Hard Rock Café as a global power they are able to quickly respond to changes in taste and demand. They are also able to diversify the business through venturing into live music thus meeting the demands of their growing customer base.

Hard Rock Café employs over 75% of the people in the U.S. Most of the staff are employed in the restaurants and the retail shop as hostesses, wait for staff and bartenders. Hard Rock Café recognizes the importance of human resources and they are engaged in the running of the business thus creating a good working relationship with the management. Hard Rock Café also recognizes that its strength comes from its employees that the reason they give them a chance to feel part of the business.

Supply management is an important operational area in any business venture. All the products and services sold under the Hard Rock Café brand comply with human health as they undergo a scale that determines its suitability. They have an efficient supply-demand network that helps in meeting the demands and needs of their customers. The café has a close relationship with the customers and suppliers.

Hard Rock Café has close cooperation with its suppliers; this has enabled them to optimize their inventory levels. The suppliers are also involved in product development thus safeguarding for future production. Also, the diversification of the location of suppliers has supported efficient inventory management. Hard Rock Café builds its inventory putting in mind the demands of its products thus minimum inventory levels must be maintained.

To meet daily demand and seasonal changes in the tourist environment of Orlando café staff are scheduled after every 15-minute interval. Taking measures and scheduling in anticipation of a new product is a critical issue.

Development and training of the employees are one of the Hard Rock Café promises. They pay attention to new ventures i.e. the website and radio programs and maintenance of high-level trained staff.

Hard Rock Café staff i.e. kitchen and wait staffs are very competent, passionate about music and have a great engaging and attractive personalities. This has contributed to a closer relationship with the management, thus creating a good working environment.

In conclusion, the ten decisions of operation management and productivity are very vital in running all business. They help in creating a bond from the processing of the input to the final product.

References

1. Heizer, J., & Render, B. (1996). Production & operations management 4(ed), Print Introduction to Operation Management. (2007). Web.
2. Nigel, S., Chambers S., & Johnston, R. (2007). Operations Management 6(ed),
3. 10 OPERATION MANAGEMENT DECISIONS.
4. Meissner J., Operations Management. Germany: University of Hamburg, 2010. Print.