Executive Summary
The aim of the report is to evaluate the strategies of change in the organizational environment and, as a consequence, in corporate strategies. In order to compete in modern world, the consumer company should create high performance team systems able to perform all activities and coordinate all areas of organizational environment. High performance work systems (HPWS) should be seen as a systematic approach to an increasingly important responsibility of general management: positioning today’s business firm in a rapidly changing and complex global environment. To do so successfully, corporate leaders should install organizational processes that can help them understand how the environment might be changing and what the effect of likely consequences will be.
Introduction
Confronted by contemporary high-velocity environments, corporate executives are becoming more interested in understanding environmental forces. These enable or disable successful changes in strategy. Otherwise, despite their current strengths, the consumer product company is unlikely to be able to meet the challenges of the emerging high-technology and deregulated global economy. It should be recognized that predicting a world in which technology and collective and competitive patterns change at an unprecedented rate is hard enough. Moving ahead of it is simply larger than the extended talents and resources that are now available in any of the world’s leading firms.
Objectives
Objectives of the HPWS implementation are to improve current performance of the consumer product company and develop a new approach to marketing and management based on HPWS. The purpose of this intervention is to build a deeper understanding of the dynamic interactions between the company and its customers, as well as between the team members and potential customers. Participation in the design of organizational structure helps the company understand exactly how it plans to transform each initial sales call and customer transaction into a service relationship through partnership. The company’s director commands a small regiment of online database searchers, full-time clerical staff, and research fellows. A small salesforce ‘sells’ services to new customers. As business grows, this force will help the company maintain an ongoing service relationship with those customers who choose to become partners (Buchholz & Roth, 1987).
Concerns and Pitfalls
Historical information suggests that lack of strategic vision and inability to innovate were the main problem of the company. The company was unable to join the core strategic areas and deliver the best possible services to its customers. The concerns are that strategy design begins with the recognition of environmental threats and their transformation into opportunities. The first pillar should be an awareness of the firm’s dependency on its environment. Firms, like the consumer company, must learn to act on Porter’s five forces, namely, competitors, buyers, suppliers, substitute producers, and potential new entrants.
A second wise move should be to engage actively in environmental scanning, building competitive intelligence systems beyond internal management information systems. The company was unable to recognize that the strategic designers of the twenty-first century will be far more outward-bound than the traditional organizational designers. They have to scan the transnational business scene and to see well past the narrow task environment of a specific product line or line of business (Hanlan, 2004). They will have to devise ways to keep track of and to model environmental changes through triggering events and trends. This must be done carefully, to ensure that the various changes considered are compatible.
Potential Gains and Resource Deployment
In their responses to environmental challenges, the consumer company should be hampered by a variety of response barriers, such as entry, exit, and inertia barriers. These require keeping track of competitors’ moves, resource requirements, and environmental opportunities. It will be crucial to take into account that changes in the external environment indicate shifts in consumer values or competitive dynamics, whereas changes in the internal environment indicate shifts in organizational structure or managerial capability (Vargas, n.d.).
Both external and internal changes lead to pressures for change by providing feedback that a firm is misaligned with its economic and sociopolitical environments. Potential gains will involve improved customer service and customer satisfaction, brand loyalty and increase revenues. Also, HPWS will help the company to compete with other forms and ensure long-term success based on improved technology and new customer communication. Fortunately, the business environment and fierce competitors now focus managers’ attention on computer and information resources. Firms and governments that challenge their managers to tap the potential of these resources are gaining a competitive advantage.
These successes press status quo champions to change their attitude. Such traditionalists may be reluctant to share information because they equate information with power. Indeed, most information technology solutions make more information available to more people, including subordinates and customers. To achieve an IT-driven competitive advantage, managers must be willing to dispel the prevailing introcentric attitude toward strategy design (Katzenbach & Smith 2003).
Tactics and Strategies of Implementation
Each system will be responsive to a particular velocity, which the firm must confront. Before implementation, the company should review its current strategic systems and customers expectations (Blanchard, 2004). The implementation stage should be based on the following principles: shared power and high involvement, shared information and open communication, combined systems and structure, focus on customer results and ongoing learning (Blanchard, 2004). Its managers should select the structure and system appropriate for this velocity. Hence the prevalent emphasis is on the notion of environmental turbulence and its levels. Modern organizations are incredibly complex and continually try to adapt to changes in their environment. The technology of scenario construction allows discovering possible implications of a problematic structure (LaFasto & Larsen, 2001).
The consumer company should seeks to build and maintain a procurement assistance service for its business partners, a current awareness service on import and export possibilities, business transfers, and expansion plans. At the request of a customer or partner, the company can also undertake original research in the areas of accounting, banking and finance, management, surveys, and market studies under the supervision of internal consultants. Original data searches are carried out by experienced information specialists or by subject experts of worldwide information centers, under contract. To become useful information, data must be interpreted by experts. The company internal consultants give the company the expertise needed to interpret and use information in the context of business applications. The company can release no information without approval (Imperato, 2000).
A special attention should be given to learning environment. Following Lazaridou (2002): “The environment of the group should also be supportive, with a focus on learning. A variety of educational tools, including experts in the field should be readily available to the team to assist in problem solving” Whether these conditions encourage or block changes, a central research question arises from an adaptation theory perspective. It concerns identifying and explaining how external and internal variables characterize the forces that signal disequilibrium in corporate behavior. The primary implementation question concerns how changes in environmental and decision variables interact to stimulate movement toward continuous performance improvements. The company should institute attempts to increase both the reach and the range of the IT platform beyond the level that small local firms could afford on their own (Kalleberg, 2003).
Factoring simplifies decision making through a network of specialized decision functions. This network will handle the distribution of information among a firm’s decision functions. Each function will receive only part of the available information, an amount small enough for timely processing and action. With no decision maker having the whole picture, each has a unique but limited view of a firm’s strategic situation. Goals and incentives also simplify decision making. They focus managerial attention on specific dimensions of performance by determining what information is important in making a decision (e.g., shipments against orders outstanding), and what information can be ignored (e.g., quality). Frantic changes ensure that each goal is met at the end of each quarter regardless of any strategic implications. This is short-sighted decision making at work, but it is simple.
Recommendations
Through computed scenarios firms can define and analyze changes in strategy as concrete and observable phenomena rather than as metaphor. Both external and internal conditions specific to a firm’s strategic situation can dictate the nature and timing of changes in strategy. The director of the company should serve as input managers, while new customers and partners specify the desired output of research and computer searches.
The employees and internal consultants should meet with new customers or established partners on a daily basis. They work with them in small adhoc client-worker teams to diagnose the research needs of each client and to plan detailed computer searches (Lazaridou, 2002).
Adopted as a result of intervention, the matrix structure of the company will allow managing environmental uncertainty, which concerns both new market and new IT developments, to maintain a high operational efficiency and to implement its growth-through-partnership strategy. Assuredly, the matrix structure creates administrative tension. Yet, it provides the flexibility required to make changes in strategy at every level. New market opportunities and the development of new information technology frequently require such changes.
Building HPWS, the company should take into account morale and culture because these elements are important ingredients for success. The company needs to have a grand design of where it is headed. Authority and corporate culture simplify decision making intangibly. They transmit the company’s values and traditions to all its constituents. In turn, these values and traditions permeate thinking in all decision functions, altering the assumptions of decision makers and introducing bias and distortion into the interpretation of information.
References
Blanchard, K. (2004). The HPO Scores Model. Web.
Buchholz, S. Roth, Th. (1987). Creating the High Performance Team. Wiley.
Imperato, G. (2000). Real Tools for Virtual Teams. Web.
Hanlan, M. (2004). High Performance Teams: How to Make Them Work. Praeger Publishers.
Kalleberg, A. L. (2003). High performance work organizations: Payoffs to participation. Web.
Katzenbach, J. R., Smith, D. K. (2003). The Wisdom of Teams: Creating the High-Performance Organization. Harpercollins Trade Sales Dept.
LaFasto, F., Larsen, C. (2001). When Teams Work Best. Sage Publications.
Lazaridou, S. (2002). Work teams: Three models of effectiveness. Web.
Vargas, P. (n.d.). Building high performance teams. Web.