YAS Cycles – Business Excellence

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Introduction

Business excellence is essential for businesses to remain competitive and grow their value. In developed countries, such as the UAE, the level of competition is usually higher than in other locations, which makes business excellence particularly relevant. Business excellence awards can assist businesses in attaining this goal since they often provide well-defined criteria for processes and outcomes in all areas of activity. The present report will seek to provide an overview of business excellence awards that exist in the UAE and evaluate the impact of international excellence awards on them. Then, the work will give an overview of a UAE-based company YAS Cycles and perform a self-assessment of the business to provide relevant recommendations concerning business excellence.

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Overview of UAE Excellence Awards

First of all, the Sheikh Khalifa Excellence Award (SKEA) was established in Abu Dhabi in 1999. This award was intended to become “a roadmap and a methodology for continuous improvement aimed at enhancing the competitiveness of the Business Sector in Abu Dhabi and the UAE” (SKEA, 2020, para. 4). In contrast with some other awards, SKEA is considered to be a program that supports companies in attaining and maintaining business excellence rather than a one-time achievement. Hence, SKEA offers services and products aimed at promoting business excellence in UAE businesses regardless of their size and scope. The award is administered by the Abu Dhabi Chamber of Commerce & Industry (ADCCI) in Abu Dhabi (SKEA, 2020). However, companies from all over the UAE can use SKEA services and receive the award.

The second award that is popular among businesses in the UAE is the Dubai Quality Award. This award was established in 1994, making it the oldest business excellence award in the UAE (Department of Economic Development, 2020a). The Dubai Department of Economic Development administers the award, and it can be received by businesses operating in Dubai, as well as in other locations in the UAE. The primary purpose of the award is to support the development of UAE organizations by providing a framework for continuous improvement while also recognizing outstanding achievement. Using the model behind the award, businesses can benchmark their activities and outcomes to industry excellence leaders (DED, 2020a). For the government of Dubai and the UAE as a whole, the initiative is also beneficial as it helps to ensure that business development strategies are aligned with government goals for socio-economic development (DED, 2020a). Thus, the award contributes to the development of business excellence in the UAE and supports the overall growth of business in the area.

While most business excellence awards focus on private sector organizations, the Abu Dhabi Government Excellence Award targets the public sector. Still, the framework behind the award and the criteria included in it can be applied to all types of companies, which makes the award particularly famous and prestigious. The Abu Dhabi Government Excellence Award was instituted in 2006 with a goal “to recognize and stimulate an outstanding performance and encourage a positive competition towards a sustainable government system that will ultimately support the vision of the Abu Dhabi Government” (General Secretariat of the Executive Council, 2017). The award is exclusive to Abu Dhabi government organizations and their members, as individual awards are also included. The organization administering the prize is the General Secretariat of the Executive Council, which is one of the top government institutions in Abu Dhabi. The complex structure of the award framework, combined with its flexibility, contributes to the advancement of business excellence principles in the government sector of Abu Dhabi.

Mohammed Bin Rashid Al Maktoum Business Award (MRM) is another business excellence award that has a continuously positive impact on UAE-based businesses. The award was established in 2005 under the patronage of Sheikh Mohammed Bin Rashid Al Maktoum, who is the Vice President of the UAE (Dubai Chamber of Commerce & Industry, 2020). The primary purpose of instituting the award was to “recognize and celebrate the success of organizations that contribute to the sustainable economic development of the UAE and the greater GCC region” (DCCI, 2020, para. 1). This means that, as opposed to other awards identified in this section, the MRM award is also available to businesses operating in the GCC area. The award is administered in Dubai by the Dubai Chamber of Commerce and Industry annually.

Lastly, the two related awards that are particularly relevant to Sharjah businesses are the Sharjah Gulf Excellence Award and the Sharjah Excellence Award. These awards are very similar in terms of their purpose, criteria, and history. Both awards were instituted in Sharjah by the Sharjah Chamber of Commerce in 2017 (Sharjah Excellence Award, 2019). Their primary purpose is to assist private sector businesses in enhancing value and performance based on proven business excellence methods. The Gulf award is available to all private sector organizations of the GCC countries, including Saudi Arabia, Oman, Bahrain, Kuwait, and the UAE (Sharjah Excellence Award, 2019). The Sharjah Excellence Award, however, is reserved for businesses operating in Sharjah. Both awards target businesses in various sectors of the economy and have the potential to improve the business environment in Sharjah and the UAE as a whole.

Impact of International Excellence Awards

The Malcolm Baldrige National Quality Award is awarded to American businesses by the American Society for Quality. One of the primary purposes of the award is to promote product and service quality, and thus quality is among the core focus areas of this award. The framework behind the MBNQA is the Baldrige Excellence Framework, which is widely applied in American and international businesses. The structure includes seven key elements, including Strategic Planning, Leadership, Customer Focus, Workforce Focus, Operations focus, Results, and Measurement, Analysis, and Knowledge Management (Peng & Prybutok, 2015). This enables the award to translate various values, including customer-driven excellence, visionary leadership, organizational learning, agility, innovation, and excellent human resource management (Enquist, Johnson, & Rönnbäck, 2015). Businesses that apply this award model are likely to benefit from higher levels of customer satisfaction, improved market share, and sustained performance.

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The EFQM Global Excellence award is based on the EFQM excellence framework, which is very similar to the Baldrige model. The two sections of the model are enablers and results, which mirrors the value creation process in most companies (Toma and Marinescu, 2018). The first section contains the criteria of leadership, strategy, people, partnerships and resources, and processes. In contrast, the second section is devoted to results in terms of customers, people, society, and business (Toma and Marinescu, 2018). This allows the framework to address various types of value created through business activities, including societal value and HRM value.

Lastly, the Deming Prize is based on the total quality management framework, which emphasizes continuous quality improvement as part of organizational development. The Deming Prize is similar to the other awards in its purpose and goals, although there are some differences in terms of model criteria. The criteria included under this framework are policies, organization, information, standardization, human resources, quality assurance, maintenance, improvement, effects, and plans (Ghicajanu, Irimie, Marica, & Munteanu, 2015). The model focuses more on the internal processes that enable business success rather than on the financial results and benefits to customers and society. This makes the model particularly relevant in manufacturing companies, but somewhat restricts its application in businesses with significant corporate social responsibility goals and those applying the triple bottom line approach.

Frameworks and Criteria

Based on the explanation above, it is evident that the EFQM excellence framework had the most significant impact on the development of business excellence awards in the UAE. Many of the awards discussed in the previous section are based on EFQM criteria, meaning that they apply the same assessment framework like the one used in the EFQM Global Excellence award. For example, the SKEA program developed the first Arabic version of the EFQM 2013 model, which is currently used as the foundation for the SKEA assessment (SKEA, 2020). This means that, similarly to the EFQM Global Excellence Award, the SKEA encourages businesses to develop processes and engage in activities that benefit the organization, its customers, workers, and society as a whole.

Furthermore, the Dubai Quality Award is also based on the EFQM excellence model and uses the same criteria as the EFQM award for evaluating candidates (DED, 2020a). Similarly, both Sharjah business excellence awards apply the EFQM Excellence Framework as part of the assessment and seek to promote its broader use in businesses (Sharjah Excellence Award, 2019). Thus, the EFQM framework has had a significant impact on the UAE awards by providing criteria for excellence.

The MRM Business Award is different from the award mentioned above since it is not based on a single framework. Instead, it incorporates the elements of the MBNQA and the EFQM Global Excellence Award in the MRM Business Framework. Similarly to the EFQM, the components are divided into two categories: processes and results (DCCI, 2020). Some elements of the MRM model are also similar to those of the MBNQA and the EFQM award, such as leadership, strategy, operations and processes, and customer results (DCCI, 2020; Ghicajanu et al., 2015). However, the framework also includes other components, such as innovation and corporate social responsibility. Moreover, the results are judged based on more criteria and include outcomes in most of the process components (DCCI, 2020). Thus, while the EFQM and the MBNQA probably formed the foundation for the MRM Business Award, the actual framework differs from both.

Lastly, the Abu Dhabi Government Excellence Award uses a complex framework that is different from all international awards discussed in this section. Some components of the award model mirror those in the EFQM and the Deming Prize, such as finance, resources and assets management, human capital, and governance (GSEC, 2017). Still, the differences are vast and are associated with the focus of the framework. Contribution to the government’s vision and adherence to the overall public sector strategy is the core feature of the framework, with innovation and internal processes acting as the other two pillars (GCES, 2017). Furthermore, the structure involves some components that are absent in the international award models, including risk management, corporate communication, business continuity, and digitization (GCES, 2017). These differences are explained by the fact that the award is tailored to the Abu Dhabi public sector environment.

Categories and Requirements

From the information available online, it appears that all three international models studied during the course had an impact on the categories and requirements of UAE business excellence awards. First of all, the Deming prize was influential since it differentiates first-time applicants and past winners. Similarly, the SKEA, Dubai Quality Award, and the MRM award distinguish between new candidates and companies who have already won the award in the past. For example, the SKEA Diamond Award is only available to past winners, as is the Gold Dubai Quality Award (DED, 2020b; SKEA, 2019).

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Nevertheless, the SKEA Award is different since it provides an opportunity to past applicants who have achieved significant improvements to win the Gold award, regardless of whether they have won in the past (SKEA, 2019). Hence, although award categories mirror the ones included in the Deming Prize, there are some differences. Most UAE excellence awards are also distinguished by the industry sector, similar to the MBNQA award. For instance, the Dubai Quality Award is available in construction, education, health, finance, manufacturing, professional, trading, services, tourism, government, retail, transportation, and logistics sectors (DED, 2020b). The SKEA has similar sections with the addition of oil and gas and SME categories (SKEA, 2019). Therefore, the MBNQA also has an impact on UAE awards’ categories.

Participation requirements are also similar across the different models in the UAE and globally. Geographical restrictions applied to companies in all of the UAE awards discussed mirror those of the MBNQA, which is limited to American businesses. In terms of company size, most UAE awards do not impose any restrictions, thus reflecting the requirements of the MBNQA, EFQM award, and the Deming Prize. The final condition that is evident in all of the awards is that companies should be able to demonstrate proof of excellence through assessment and evaluation. This requirement is natural, given that business excellence is the focus of the awards.

Overview of the Organization

The company chosen for analysis is YAS Cycles, which is a medium-sized cycling gear retailer based in Abu Dhabi. The company’s primary mission is “to build and support the rapidly expanding cycling community in the UAE” (YAS Cycles, 2019, para. 1). The company is less than five years old, meaning that it is still relatively new to the market. However, the owners are already planning to expand the chain to other locations in the UAE, including Dubai and Sharjah. The competition in the cycling market is currently moderate. However, there is a high threat of new entrants into the market, given the rising popularity of healthy activities and eco-friendly behaviours. Staying competitive and providing value for both customers and the community is crucial to YAS Cycles. Applying the concepts of business excellence and engaging in continuous improvement could help to achieve this goal.

The services offered by the company are among its key competitive advantages. The company provides a full range of services to meet the needs of customers, which include shopping assistance, security checks, bike maintenance, and more. Another vital feature of YAS Cycles is the high personalization of services. The company caters to the needs of cyclists regardless of their age, interests, and ability levels. As part of its commitment to the popularization of cycling in the UAE, the company holds beginner rides and offers cycling training for children and adults (YAS Cycles, 2019). The products purchased in-store can be delivered to customers at a small charge, which contributes to the overall shopping experience. The second source of competitive advantage for YAS Cycles is the personnel. According to the company, YAS Cycles focuses on hiring people who have extensive cycling experience and are passionate about cycling in general. For this purpose, the company offers competitive pay to all in-store employees. The owners are also devoted to building company culture through regular staff events that support engagement and commitment to the organization.

Despite the advantages identified above, the company struggles with fulfilling its long-term goals. Based on internal financial information, the profits remained relatively stable over the years, which might mean that there are issues in the company’s strategy. Additionally, some human resources issues affect customer satisfaction and performance. For instance, the retailer is suffering from a high turnover of staff in both locations. This contributes to staff costs due to the need to hire and train new staff continuously. These issues could affect further development of YAS Cycles and should thus be addressed adequately.

Business Excellence Model Application

Although the owners understand the potential contribution of excellence to success, the company does not use any business excellence model at the moment. The first step in addressing the issues faced by YAS cycles is thus to determine the most appropriate model to be used. The model should align with the company’s long-term strategic goals while also allowing the business to receive recognition in the UAE. The latter objective would contribute to YAS Cycles’ continuous improvement goals and make it more attractive for highly qualified employees who could support the company’s growth.

Given the current situation in the company and its strategy for future development, the EFQM business excellence model would be the most appropriate. First of all, this model stresses the importance of generating value for customers and society, which is among the critical components of YAS Cycles’ vision and mission (Enquist et al., 2015). The application of the EFQM excellence framework could help the company to tailor its strategy and processes in a way that would support its goals. Secondly, the EFQM framework is also concerned with human resource management and employee satisfaction (Enquist et al., 2015). At the moment, both areas appear to be of concern to YAS Cycles’ management due to the high turnover of retail employees.

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Thirdly, the EFQM framework could also contribute to the development of company culture, which is of utmost importance to YAS Cycles. Although the owners are focused on increasing profits, they also want to build a national brand with an excellent reputation among customers. Formulating and sustaining corporate culture is necessary to achieve this goal, and the EFQM model could contribute to YAS Cycles in this area. Finally, it is evident that the company is not planning to expand to other countries yet and is focused on the UAE cycling market at the moment. As explained in the previous section, several of the UAE business excellence awards draw on the EFQM model and use it as a foundation of their assessment process. In this way, the application of the EFQM excellence framework would enable YAS Cycles to receive recognition in Abu Dhabi and other emirates.

Since the company does not use any excellence framework currently, it will need to establish new processes and structures in place to apply the EFQM framework. According to Oakland (2014), self-assessment is a powerful tool for identifying problems and areas for improvement. In the EFQM approach to excellence, self-assessment holds particular value since it enables companies to determine the current degree of compliance with the model criteria and generate short- and long-term strategies that would help to improve performance (Oakland, 2014). While the company could conduct a full-scale self-assessment independently, the present report will focus on evaluating the current performance in terms of strategy. This category relates to the most pressing issues identified at YAS Cycles, and thus performing an evaluation and providing recommendations for improvement could support the company’s future development.

Self-Assessment

To assess the current performance in terms of strategy, interviews with owners and managers were conducted. This method of data collection was chosen due to the need for in-depth information about problems and their possible causes. During each of the four interviews, questions related to each criterion and its sub-criteria were offered, and the interviewees were asked to evaluate performance and provide reasons for their answers. Then, the data recorded during interviews was assessed based on the level of evidence to determine the final score. Based on the assessment chart provided by Oakland (2014), each sub-criterion was weighed between 0 and 100%, and the total criterion score was calculated as the mean value among all sub-criterions. Concerning strategy, the following sub-criteria were that it is “a) based on the present and future needs and expectations of stakeholders; b) based on information from performance measurement, research, learning and creativity related activities; c) developed, reviewed and updated; d) deployed through a framework of key processes; e) communicated and implemented” (Oakland, 2014, p. 158). The results of the self-assessment showed important strengths and areas for improvement (Table 1).

Table 1. Scoring cohort.

Criterion Sub-Criterion Sub-Criterion Result (%) Total result (%)
Strategy The strategy is based on the present and future needs and expectations of stakeholders 25 40
The strategy is based on information from performance measurement, research, learning, and creativity related activities 25
The strategy is developed, reviewed, and updated. 75
The strategy is deployed through a framework of key processes. 50
The strategy is communicated and implemented 25

For the first sub-criterion, the current approach to strategy planning is minimally based on the present and future needs and expectations of stakeholders. The owners stated that they review customer feedback regularly, but they do not consider other stakeholder groups in their planning. One strength of this approach is that customers are prioritized, which helps to increase customer loyalty and sales. The weakness is that other stakeholder groups, such as local communities and employees, can impact the business negatively if their needs are not taken into account.

In terms of the second sub-criterion, the current approach also has gaps. The owners stated that their strategy comes mostly through brainstorming and some internal research, such as customer feedback. This demonstrates a good grasp of creativity-related activities, which is a strength. However, the owners do not take into account market trends and performance management results, which has an adverse effect on the strategy.

For the third sub-criterion, the owners stated that they develop and update their strategy at least annually. They also review it if performance goals are not reached in a given quarter, which is an advantage. Still, the owners admitted that the review could be more thorough. Similarly, with regard to the fourth criterion, the owners have a good understanding of the process of strategy formulation and apply it to structure their activities. Still, the framework lacks essential steps, including market research.

Finally, the degree to which the strategy is communicated and implemented is insufficient. The current approach is that the owners communicate strategy to the top managers, and communication often ends there. One advantage of this approach is that top managers can support strategy implementation, but other people in the company need to know about the strategy, too.

Recommendations

There are three key recommendations based on the analysis that should be applied to improve the situation in YAS Cycles. The first recommendation is to alter the approach to strategic planning by introducing new sources of information, such as market research, stakeholder needs assessment, and expert reports. These sources of information are crucial for the company to understand the current situation at the micro- and microeconomic levels. For example, industry reports provide an excellent opportunity to determine the trends that affect the target market and map out the competition. Expert reports, in turn, could be useful to understand the opportunities and challenges faced by the company that has to be reflected in its strategy.

The second recommendation is for the company to improve strategic communication to all levels of the organizational hierarchy. Once the strategy is reviewed and updated, it should be communicated to all employees both in full and in a short form. This would help to make sure that employees are aware of the company’s goals, plans, and objectives and can understand how their daily work contributes to the company’s long-term success. Supporting adequate communication regarding company strategy would also assist YAS Cycles in leveraging employee engagement and commitment by making them feel like an integral part of the organization.

The third recommendation is for the owners to review their process of strategy formulation by creating a specific, step-by-step framework to incorporate all the key processes. This would help them to be more structured in their approach to strategy planning and to ensure that all the required data is considered before a new strategy is implemented. Hence, this recommendation would also support the application of the other two suggestions.

To succeed at implementing all of these recommendations, YAS Cycles should apply the RADAR Logic, which is a powerful instrument for assessment and development. As explained by Oakland (2014), this method helps to improve the outcomes of organizational efforts and initiatives while also providing a way of tracking results and building on them. As part of implementing this tool, the company should define the required outcomes in each of the four initiatives, set measures to track progress and implement monitoring processes that would help to determine and assess results. Using the RADAR Logic would help YAS Cycles to yield the most value from the recommendations provided here and guarantee that the changes impact organizational performance positively.

Conclusion

Overall, business excellence is essential for organizations to succeed in the modern business environment, and various award models and frameworks can support companies on their journeys to excellence. The analysis of UAE business excellence awards shows that most of them are rooted in infamous international awards, such as the MBNQA or the EFQM Global Award. In the case of YAS Cycles, the EFQM award model would be the most appropriate since it aligns with the company’s long-term mission and vision. The results of self-assessment suggest that significant improvements are required for YAS Cycles to meet the EFQM award criteria of People and Strategy. Recommendations for improvement are provided as part of the report and include enhancing strategy generation process, strategy communication, organizational communication, organizational learning, and talent planning. Using the RADAR Logic to implement these recommendations would assist the company in achieving excellent outcomes and moving one step closer to excellence.

References

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YAS Cycles. (2019). About YAS cycles. Web.

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