Udayan Care Company’s Strategic Management

Abstract

The paper examines the existing issues in Udayan Care, a social enterprise that struggles with recruiting motivated employees, covering administration issues with donations, and providing better results in some of its programs. The company’s lack of integrity and strategy does not allow it to achieve growth; the poor IT infrastructure and delays in projects result in the withdrawal of funds from donors. All these problems need to be resolved by adopting strategies that will define the company’s goals and objectives specifically.

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Introduction

Udayan Care is a non-governmental, not-for-profit organization that provides help for underprivileged children, teenagers, and young adults in India. The first problem that is striking is the human resource problem, namely the high rates of turnover, and the lack of motivated employees and volunteers. This is a problem because due to the turnover the company is not capable of becoming stable or growing. This can be linked to the company’s inability to formulate and execute a strategy. A clear strategy would attract those employees whose aims align with it; however, it appears that the company has not yet developed a clear strategy to execute.

The next problem is the company’s inability to use funds and fundraising opportunities efficiently. This problem is directly linked to the previous one because people hired for key positions were not able to perform their duties.

The next problem is the IT integration that is inefficient and inadequate. The company’s inability to provide sufficient IT infrastructure resulted in the little benefit from technology-based programs that could provide useful information about donors. The company’s executives were also not able to operate IT programs that could help them handle the records.

The issues that need to be addressed immediately are the IT infrastructure inadequacy and human resource issue that results in reduced organizational efficiency. Since employees of the company do not understand the strategic directions of Udayan Care, they cannot perform their duties effectively. This, in return, results in decreased profitability and adversely influences the morale of the company’s employees.

IT infrastructure is crucial for the company’s profitability because IT can provide data about analytics that can help improve decision-making. Moreover, informational technologies are directly linked to the company’s productivity because they are responsible for handling transactions, gathering data, and distributing or providing needed information. Furthermore, “IT competency positively moderates the marketing effectiveness-competitive advantage relationships”, which also influences customer satisfaction (Ussahawanitchakit, 2012, p. 12).

Case Data

The issues arose due to the lack of donors who would agree to meet capital and revenue costs that were common for the Udayan Ghar program. Many of the projects were delayed, which lead to donors’ frustration and withdrawal of funds. This problem was linked to the company’s inability to find lifetime volunteers committed to the company’s aims and objectives. Recruitment of caregivers was also a challenging task, and apathy in mentored children put additional pressure on it. These issues affect both the employees of the company, the funders, and the strategic managers who cannot develop strategies because the company’s vision and mission are not formulated precisely. The lacking alignment of the company’s processes with the stakeholders’ needs (i.e. donors) is also a source of problems (Berman, 2015). Nevertheless, strategic managers can use several opportunities. First and foremost, the company’s goals and vision need to be formulated clearly. Strategic managers can develop the next strategies based on general company goals. Dysfunctional key actors also negatively influence the company’s effectiveness (Berman, 2015). Therefore, it is crucial to recruit those employees who will support the company’s missions and be motivated enough to complete the provided tasks (i.e. develop mentoring programs, work with apathetic children, ensure a uniform approach to children is adopted). The lack of strategy in HR management leads to delayed processes and failed projects, which, in return, results in withdrawn funds.

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The main constraint is the limited talent pool in the NGO market sector; potential employees with rich experience in NGOs are hard to find. The next limitation is the funds’ donation for a specific purpose. To improve the company’s effectiveness, additional capital is needed to cover issues in HR and IT sectors; however, funds usually target specific programs of the company and rarely cover administrative costs. The major share of funds is provided by either funding agencies, trusts, or foundations.

Alternatives

To resolve the existing programs, the company can choose a different approach to social change and its stakeholders. For example, like many social enterprises, the company can “integrate social missions with business ventures” (Smith, Gonin, & Besharov, 2013). This approach will allow the company to gather additional capital to review and change its human resource strategies, as well as other administrative issues.

Another alternative is to adopt a strategic management approach and outline the primary goals and objectives of the company that will identify the company’s following strategies. However, in this case, only localized strategies can be employed, due to local conditions that shape the company’s program (see The Udayan Shalini Fellowship Program).

At last, the company can adopt the “Think Local, Act Global” approach by reviewing the strategic management of other NGOs from other countries and adopting this approach with particular modifications. These changes will accommodate the preferences of local stakeholders.

A globalized approach will not be sufficient because it is a non-governmental and non-profit company that does not manufacture and produce products globally but provides social change and addresses other needs of underprivileged members of society in India.

Decision Criteria

The decision criteria developed for this case are the following:

  1. Maintain stakeholders’ satisfaction
  2. Find committed employees
  3. Reduce turnover rates
  4. Enhance and improve IT integration
  5. Create a clear company’s vision and mission

As can be seen, these criteria are based on the issues identified in the case study. To overcome them, the company will need to choose one alternative that will fit into the five decision criteria.

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Evaluation of Alternatives

Stakeholders’ Satisfaction Committed Employees Reducing Turnover Improving IT Integration Company’s Vision and Mission
Social missions + business ventures Possible improvement in delayed projects Will need to hire employees without experience in NGO Turnover rates might remain the same if not addressed specifically IT integration is crucial for business ventures Does not target vision and mission
Strategic Management Stakeholders-centered strategies Research of HR dissatisfaction will indicate further strategies for improvement Possible if strategies for employee commitment are implemented Use of social media and IT needs to become the company’s primary aim Can create strategy-oriented vision and mission
Think Local, Act Global Global strategy can be adapted to approach stakeholders’ needs Can investigate local conditions that impact employee commitment Turnover rates are not linked to the local market or industry but the company’s internal issues IT integration is crucial for implementing the strategy (will be implemented) Can create vision and mission according to global strategies

The alternatives presented in the table address the issues that were identified in the first paragraph. Although the first alternative has the potential to successfully resolve problems with the stakeholders and IT integration, it does not guarantee the recruitment of committed employees. The third alternative covers all issues except for turnover rates. It seems reasonable to point out that most of the issues the company is facing are causes of its internal conflicts and difficulties.

Selecting the Preferred Alternative

As can be seen from the table, the preferred alternative for this case is the strategic management approach. The problems that arose in this company are the cause of lacking strategy, vision, and mission. It is impossible to motivate employees to complete tasks if there is no general or specific goal that the company has. This lack of motivation results in problems with HR, IT infrastructure, and donors who cannot rely on a company that is incapable of performing its duties. It is crucial for the company to define its aims, goals, objectives, and to develop strategies that will focus on these.

Recommendations

The company’s executives need to pay attention to IT engagement in their business. Many companies, including charities and other NGOs, have built their success on the efficient use of Web 2.0 and social media. Moreover, effective IT infrastructure will help the company raise funds and stay in touch with customers, potential donors, and those in need. Furthermore, personal computers can make employees’ work more efficient; data processing and data security will be enhanced. Utilization of IT services can also result in a more advanced system of e-Donations that the company can spend either on the programs or administration issues.

References

Berman, E. (2015). Performance and productivity in public and nonprofit organizations. London, England: Routledge.

Smith, W. K., Gonin, M., & Besharov, M. L. (2013). Managing social-business tensions: A review and research agenda for social enterprise. Business Ethics Quarterly, 23(03), 407-442.

Ussahawanitchakit, P. (2012). Information richness, marketing effectiveness, IT competency, and competitive advantage: Evidence from Thai e-commerce businesses. Journal of International Business Strategy, 12(1), 10-18.

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