However, the company has to face the change of the economic situation, and to maintain a strong position in the market, sustainably is necessary. This paper focuses on identifying the company characteristics that can meet the requirements of sustainable leadership practice. Apart from financial viability, a company's reputation or image is also treated as a main priority to stay in the top rank of businesses.
If a sustainable theory can be used and applied within the context of Thai businesses, it can help the economy grow and the country become a leader in the AEC group. On the other hand, because labor costs in some countries are lower than Thailand, Daisin's customers may invest abroad and Daisin may lose its strong position in the market. To avoid such a threat and gain a greater competitive advantage in the aluminum market, Daisin must adopt the philosophy of sustainable leadership to create strong business value and keep the business sustainable.
This case study focuses on identifying the company characteristics that can meet the requirements for sustainable management practices. To determine whether the company's characteristics fit, the literature on sustainable leadership in Thailand is reviewed in the next chapter.
LITERATURE REVIEW
- Sustainable Leadership Research Framework
- Long-term Perspective
- Staff Development
- Organization Culture
- Innovation
- Social Responsibility
- Ethical Behavior
- Previous study of Sustainable Leadership in Thailand
- Sustainable leadership in Thai healthcare service (Kantabutra, 2009)
- Sustainable leadership in Thailand oldest university (Kantabutra, 2012)
- Sustainable leadership in leading Asian industrial conglomerate (Kantabutra, 2013)
- The case company (Daisin Co., Ltd)
- Analyze the sustainability criteria
- Financial performance
Avery and Bergsteiner (2010) sought to identify key differences between long-term and short-term practices. One of the key elements to identifying a sustainable business is focusing on the long term rather than the short term. By taking a long-term perspective, companies can outperform companies that focus only on the short term (Mitchell, 2001).
2003) find that “the initially high performance of outsider CEOs collapses in the second half of their tenure and their organizations fall 5.5 percent below the performance of those led by insiders.” In the long term, the company becomes more attractive to banks, insurance companies, investors and customers. The research shows that the company was able to implement the Honeybee practice effectively because it tried to take a long-term perspective on investments rather than seeking short-term benefits.
This study focuses on one of the most successful companies in Thailand, and the results show that the company has adopted all 23 practices. For example, there is trust among employees and employers as well as customers and society based on the high level of social responsibility and ethical orientation in the company.
Profit
Johnson's research shows that both internal and external measurements should be considered for financial performance. However, the external measure that Johnson suggests is the Down Jones Sustainability Indices (DJSI), but this is suitable for companies entering the US stock market. Therefore, for the external measurement of die casting companies, this is compared to the average profit comparison in the die casting industry, as shown in the figure below.
The above graph shows that the distance between the company and the benchmark is too large, so it can be concluded that for the external measurement the die casting company could not be classified as a good financial performance. Farrell, Brealey and Myers' internal measurement research has found that external stability is driven by the internal factors. The following equation demonstrates this relationship, where L refers to the leveraged version of an organization and U to the non-leveraged version:
Profit Comparison
Endurance from social and economic difficulty
Although the company's profits may not meet sustainable standards in terms of financial performance, the company is able to survive despite many social and economic problems. For example, the economic crisis of 2008, known as the Hamburg crisis, greatly affected the company, as most of the exports.
Company Equity
Maintain leadership in related markets
Customers even buy different parts from different suppliers and try to support suppliers to improve product quality. Therefore, the automotive supplier industry is not as competitive as other industries; However, the company must guarantee quality to meet customer standards and develop the production process and cost reduction, so as to gain competitive advantage and attract major automotive companies to place more orders. According to company reports, the injection molding company still has a leading position in the market, compared to other suppliers who supply more than 40% directly to Thai Honda.
In conclusion, even if the company is able to meet the two criteria of sustainable business – endurance in the face of social and economic difficulties and maintaining leadership in related markets – it cannot deliver better financial results to meet a sustainable standard. Therefore, it can be concluded that the die casting business cannot be classified as sustainable.
MATERIALS AND METHODS
The list of open-ended questions was developed to reduce confusion for the interviewees and to obtain effective responses. The interview questions also take into account the ability of the target interviewees to answer, as well as their willingness to answer. In order to create appropriate questions, some could be modified and varied from one interviewee to the next, as this depends on the interviewee's position and ability to provide confidential information or specific questions as shown in Table 2. Target interviewees are: a company director, two MOs from production and HR, three general managers, five division managers and four section managers – a total of 15 people.
In employees, the observation method is used to reduce biased responses and gather more accurate information.
FINDING
- Developing people
- Retaining Staff
- Succession Planning
- Valuing Staff
- CEO and Top Team
- Ethical Behaviour
- Long- or Short-Term Perspective
- Organisational Change
- Financial Market Orientation
- Responsibility for the Environment
- Corporate Social Responsibility
- Stakeholders
- Decision-Making
- Self-Management Employees
- Innovation
- Quality
- Overall Analysis
The company does not really emphasize training and development, as the training budget is set at only 2 million Baht per year. But since it has around 2,000 employees, the company offers a training budget of only 1,000 Baht per person. employee. The company also offers nursery education for employees' children aged 0-4, including nursery staff and two meals for each child.
In fact, the diligence payment of the company does not impose a restriction like other companies. There is evidence that the company has a long-term perspective and is willing to invest in new technology that can improve the employees' performance, regardless of the cost, such as new robots. The company has real concern for the environment as it has received an ISO 14001 certificate for environmental protection.
For example, the company still asks all employees to separate the garbage, especially the lubricating oil from the machines. As part of my job as a purchasing department, I know that the company is trying to be approved by VVM. The company may not have any specific planning for CSR, but it provides some training to local students and the university.
If, in addition to company policy, they still ask the manager to do it for them” (HR manager). The company also sends its employees to join customers in Kaizen activity such as New Honda Cycle. The company emphasizes quality control as it sets up a quality assurance department that works with the production department to ensure this.
For example, a quality control and quality assurance department was created for quality practices, but the company did not try to encourage its employees to focus on quality. A further example is responsibility for the environment; the company only receives the ISO 14001 certificate because it is required by customers. Thus, there is concern about the environment when the ISO committee comes to audit, but after they leave, the company does not seem to care about such issues.
DISSCUSSION AND SUGGESTION
- Establishing a Sense of Urgency
- Forming a Powerful Guiding Coalition
- Vision Development
- Vision Communication
- Target Functional Group
- Focus on Message
- Communication Channels
- Communication Styles
- Specific Vision Messages
- Expected Behaviour
- Encourage Others to Act on Vision by Using Value Communication
- Heroes/Heroines Model Values
- Shared Event
- Create Short-term Gain by Using Motivation
- Identify Company Value
- Select New Employees whose Personal Value Matches the Corporate Value
- Set Up a Performance System and Reward According to Company Values
- Promote those who Exhibit Consistent Behaviour
- Identify and Develop a Successor
- Consolidating Improvements and Introducing More Changes People can return to their old habit, so after short-term gain the leader
- Strategy Formulation
- Organiasation Alignment
- Empowerment
- Institutionalising New Approaches
However, the company must ensure that these top managers share the same ideas of change. A chief operating officer of a casting company must join the guidance team and identify the main reasons why the company needs to change. Moreover, the control power must be extremely high so that it can help the company to achieve effective change.
Therefore, the vision is essential for the company to articulate its direction, its goals and how to achieve them. The vision of the company should be: "To be the best aluminum manufacturer using the latest die casting techniques for automotive parts in Asia". This is because each function may need to use different methods to gain attention and convince employees to participate in achieving the company's vision.
A company's vision states its direction, what it wants to be and how to achieve its goals. This is the most important step, as the value of the company must be determined to show which person is suitable for the job. Core values are not only important for existing employees; instead, new hires must have values that also align with the company's values.
Therefore, in the recruitment process the company should emphasize its core values before deciding to hire new employees. The next step is to analyze an appropriate strategy for the company and an effective vision statement. Moreover, to effectively achieve the company's vision, the main strategic objectives must be defined as a measure and the strategy must be standardized.
Each perspective shows the strategy that the company should adopt, and each strategy must be measurable. In terms of achieving the company's vision, a good strategy may not be effective if the company's structure is not supported. However, this type of structure may not be suitable for a company that has more than one product.
As the company grew, more people became involved and the product range expanded. Change affects all aspects of the business, for example, the daily routine, practices, policies and procedures that encourage employees to understand the company.
CONCLUSION
As this atmosphere develops, it affects employees and, as a result, the behavior becomes natural and part of the company's culture. Further research should examine other industries in Thailand using the Honeybee approach because this study only focuses on one industry. Therefore, more research in other companies may be needed to improve the framework in the Thai context.
Therefore, further research in the Thai context should focus on the relationship between the two philosophies and how to apply them in countries other than Thailand.
The End of Shareholder Value: The Real Effects of the Shareholder Value Phenomenon and the Crisis It Brings to Business.
APPENDICES
APPENDIX A: Interview Question
APPENDIX A: Interview Question (cont.)
