The purpose of this study is to evaluate strategic laboratory outsourcing at Blendcor. The last chapter concludes by giving possible solutions to the objectives of the study.
Introduction
Background
10hnson and Scholes (2002) talk about national culture as the organization is a subset of the community. The negative impact of poor fit between paradigm and strategy is discussed.
Motivation of Research
Value of the Project
The company may lose its core competencies, so the impossible dream must try to recover the loss of intangible assets. The value of the project can be equated to the absolute value of the total cost of these undesirable results.
Problem Statement
Objectives
It is also used where there is a need to discover and understand a phenomenon about which little information is available. A case study is rather a hybrid of qualitative and quantitative techniques, as it can be more qualitative or more quantitative.
Limitations
Structure of the Study
He conducted interviews when the company wanted to evaluate strategic outsourcing of the laboratory. The analysis will highlight the missing actions that will improve the company's condition.
Summary
Understanding the key success factors of the sector can result in a sustainable competitive advantage. Excelling in one of the most important success factors leads to a stronger market position and therefore offers potential competitive advantage.
Driving Forces of Organizational Change
Outsourcing
Outsourcing Strategies
The first is the shrinking of the value chain, as activities that were previously carried out in-house are transferred to the contractor. The higher the price, the more value is captured by the contractor at the expense of the outsourcer. This includes financial ability, experience with the job, nature of services offered and current clients.
Pearce and Robinson (2003, p. 298) define 'organizational culture as a set of important (often unstated) assumptions that organizational members share'. 10hnson and Scholes (2002) talk about national culture, which emphasize the importance of context. The cultures of the world are believed to be converging into a common global culture as a result of the above forces.
The South African context was dramatically transformed as a result of political transition of the early 1990s. One of the causes of uncertainty avoidance is lack of skills; it is difficult to get a job without a certificate.
Strength of Culture
Johnson and Scholes (2002, p. 230) define cultural web as 'a representation of the taken-for-granted assumptions, or paradigm, of an organization and the physical manifestations of organizational culture'. The following section will briefly define the elements of the cultural web as defined in Johnson and Scholes' text. The influence of the paradigm and 'the way we do things here' is likely to lead to management trying to minimize the ambiguity and uncertainty by looking for familiarity.
The difficulty is managing the strategic change because the necessary action is outside the framework of the paradigm. The first step to changing culture is to non-closely revise policies and procedures to support the proposed culture. Similarly, the code of ethical conduct cannot be enforced without the commitment of senior management.
The evaluation of strategic outsourcing of the laboratory will be based on the textbooks of Johnson and Scholes (1999), Lynch (2000) and Ambrosini (1998). Finally, the strategy evaluation model is adopted, which is used to assess the outsourcing of the laboratory at Blendcor.
CASE STUDY
Security Policy
These new employees become very inflexible because they specialize in certain parts of the lab where they were able to kickstart. The laboratory staff who joined during these years had witnessed the knowledge and commitment of these employees. A lot of time is wasted as the lab staff test the wrong samples and try to solve Sherlock's problem of identifying the unknown samples.
Carelessness is another problem where the lab tests the finished mixture, only to find when it fails that the mixing team has left out an additive. As far as labeling is concerned, there is a sickening habit of cheating the lab staff, which is rather business destruction. These restructuring and downsizing strategies are part of a reduction in company costs.
Older employees refer to those who joined the company before the lab exited the bargaining unit. Eventually the lab had to be outsourced, as it was perceived to be causing all sorts of problems for the company.
Quality Services
- The Laboratory- the Heart of Blendcor
There seems to be a small negative element within the lab that takes advantage of the low morale. The final test is carried out in the laboratory and the fat plant is satisfied with the laboratory's daily service. Filling cannot begin until the product has passed, as a lot number (required for product traceability) can only be generated after the laboratory has passed the mixture.
The reason for delays in the lot number generation can usually be traced back to a logistical issue, and very rarely due to the laboratory. Even more surprising is that the plant personnel view their colleagues in the laboratory as capable and well-intentioned. The laboratory does not provide the service required by manufacturing. Tests are not done on time, which prevents the release of the product.
Appana and Raj both believe the people in the lab are good, with great potential. There is a conflict in the lab due to the different Blendcor and SAPREF operating modes.
Summary
- Gap Analysis
- Portfolio Analysis
Key success factors determine whether a company will succeed or fail in the market. This is also bad news, so the company needs to develop a strategy to improve such poor performance. This has a negative impact on marketers' brand image, which could result in surrendering market share.
The SWOT diagram (Figure 2.2) proposes the application of the reversal-oriented strategies for a company faced with numerous environmental opportunities, but has critical internal weaknesses. The extent to which the strategy fits the company's resources with the environment to provide a competitive advantage will be assessed. This subdivision is concerned about the financial performance due to the implementation of the new strategy.
But such loss management could purposely aim to transfer the value of the company to the contractor in the long term. In addition, the contractor could raise the price when the company is more dependent on him, making the strategy less robust.
STARS QUESTION MARKS
Acceptability Testing
- Return Analysis
- Risk Analysis
- Stakeholder Reactions Analysis
- Acceptability of the Strategy
However, the contractor will win the tender only if the price is lower than the laboratory's budget for the same period. Blendcor is unlikely to have cash flow problems as it is backed by multinationals. Most contractors hire some of the client's employees to leverage experience.
This can hamper the proposed productivity improvements, as employees know their limited work area. And finally, employees could be on a mission to prove that outsourcing doesn't improve the situation. When the organization is overly dependent on the contractor, the service price will increase.
They will lose many benefits, and are even vulnerable to losing their jobs if the contract is not renewed. The outsourcing of the laboratory is not acceptable as far as Shell and BP are concerned.
Feasibility Testing
- Funds Flow Analysis
- Breakeven Analysis
- Cultural Aspect
This is a financially viable strategy, which will increase the company's profitability in the short term. Therefore, outsourcing the laboratory is not a viable strategy when looking at the long-term effects on the business. Finally, at the end of the year, management compares actual performance with planned performance.
According to the theory developed in chapter two of this report, management cannot delegate culture formation. It may be changed to suit a less qualified candidate of the higher breeds at the expense of a suitably qualified applicant of this class. Therefore, there is a pressure to reduce costs and achieve economies of scale that are comparable to the best blending plants in the world.
There is also a pressure of comparison with the plants of the Eastern countries, which have low-wage labor. After evaluating the strategic outsourcing of the laboratory, now is the time to evaluate the organization in general.
Summary
- Partnership with Transport Agents
- Quality and Environment Training
- Improvement of Efficiencies
It's time to cultivate a culture that is up-to-date and improves strategy implementation. It is rare to find a leader who can transform himself along different stages of the life cycle. Therefore, it is extremely important to change the management body in the company to facilitate the change.
However, it's worth saying that Blendcor is getting smaller faster than it's getting better. And it is not always true that people act dishonestly just to increase their departments' outputs. Therefore, it is important to train them, which gives them some confidence about their work.
For example, it doesn't make economic sense to send "a single sample to the lab every time it's thoroughly mixed. It's a company-wide problem and is intertwined with organizational culture and inefficiency.
Conclusion
However, it has been mentioned before that change must end in order for a winning team to be formed. Since the purpose of the study was to improve the state of the company, all other flagrant strategies will not be discussed here. Laboratory outsourcing could even weaken the product portfolio by hindering the introduction of new products to the market.
Customers are also likely to develop a negative perception as a result of implementing this strategy. But the unbearable risk associated with the possibility of value migration from the company to the contractor. Leadership change may be appropriate to get the drivers behind cultural transformation.
How Chrysler Created an American Keiretsu', Harvard Business Review on Value Chain Management pp. What is the right supply chain for your product', Harvard Business Review on Value Chain Management pp.
