Evaluation and selection of differentiation - Myassignmenthelp.Com

Question: Discuss about the Evaluation and selection of differentiation. Answer: Introduction Management in an organization consists of various functions including but not limited to recruiting, financing, appraising, selling, strategizing and coordination within the firm. Every organization needs effective management practices to sustain and function efficiently. Various theories of management have been given till date which elaborate upon the important functions of the manager. There are different types of managers that function in different organizations. Every person has a different management style and different business requires different management styles from their employees. Every organization has three levels of management top level, middle level and first line managers (Fayol, 2016). These differ in their roles, responsibilities and decision making authority. This report throws light on the functions and roles of successful managers and different approaches to management. The report aims to explain the importance of efficient evaluation of the business environment which is why SWOT, PEST and Porters five force models have been explained. Functions and roles of successful managers Peter Drucker in his book established that managers have five important functions to perform in an organization which are given as below (The balance, 2017): Setting objectives: This includes setting SMART goals for the business as well as individual employees of the firm. Organize tasks and coordinate: this involves defining tasks and their allocation as well as accomplishment. Ensuring that the right people are doing the right jobs. Motivation and communication: Employee motivation is crucial in order to ensure employees achieve their targets and are satisfied with the firm (Drucker, 2017). Communication with employees and other stakeholders creates transparency and a clear flow of information within the business. Establishing targets and yardsticks that can measure the results and overall performance of the business. This is required to make sure that the firm is moving in the right direction. Develop people through efficient recruiting, training and nurturing employees. To ensure that the employees personal learning and growth is also catered to by the employer firm. Bureaucratic and administrative approaches to management Bureaucratic management refers to two important elements of management. Firstly, the hierarchy and organizational structure of the business must be clear. Secondly, the organization along with its members will be governed by clear and well defined set of rules (Bratton Gold, 2012). This approach keeps all the decision making authority to the top management of the firm. Max Weber was the first to define bureaucratic management. He stated that the division of labor and specialization must be clear in every organization. The organizations that follow the bureaucratic approach of management are ideally rigid, structured, formalized and authoritative. Administrative approach also leads to formalization and bring in structure to the organization. However, it does not concentrate power to just one person. The employees of the organization are given sufficient freedom to make small decisions. They are encouraged to participate in strategic decisions but the ultimate authority lies with the top management (Waring, 2016). This approach to management lays emphasis on motivating employees and ensuring their satisfaction in the organization. Recent approaches to study of management More recently various contingency approaches to management have been administered with specify that there are no fixed kinds of management styles rather every individual has a different style of management that suits best. It has also been identified that no fixed set of rules can govern the management principles across all the organizations. Rather due to the ever changing work environment, it is imperative that managers learn to adopt to the changing situations and make the best out of every situation. Similarly, aspects like employee motivation, employee satisfaction and work life balance of employees has also been gaining ground. Managers now lay special emphasis on how to retain and satisfy employees hired by the business. Pestle Model PESTLE model is performed to identify the situation of the external environment within which a particular company is operating. Marketers are recommended to conduct PESTLE analysis of their business frequently in order to remain aware about the industry on-goings (Hassan, 2012). Political The fast food industry has been facing issues from various governments who aim to minimize the developing fast food culture as well as reduce the extent of obesity. The health promotion boards of countries often indulge in the promotions of a healthier lifestyle as well as they organize many events in order to discourage the habit of eating junk food (Health promotion board, 2014). In doing this, automatically they indirectly lead to De-Marketing or creating negative publicity of fast food joints like McDonalds. The company must aim to secure the profit margins in various countries after a detailed study of the political state of that country as this tends to impact the businesss bottom line. Socio-cultural The socio-cultural environment that currently exists is well suited for the brand. The brand McDonalds breeds upon the increasing consumption of fast food. Families are largely dependent upon the fast and easily available food of McDonalds. But, a large number of people are now moving towards a healthy lifestyle and hence to secure its current market position, the brand McDonalds must introduce healthy food options in their chains. This has a positive impact upon the operations of the companys business and also leads to maximizing the sales (Sachdeva, 2015). Technological In the present scenario, most of the people are very well versed with the technology. To the extent that most people prefer that their food is ordered online or with the help of mobile applications. Any kind of restaurant which is unavailable on either of these platforms, by default faces a competitive disadvantage. The brand has successfully tied up with various delivery applications like Zomato, Uber Eats, Food Panda and other local apps of different countries. Competing firms of McDonalds including Burger king and KFC are also technologically advanced and hence in order to gain an advantage over them, McDonalds must work upon enhancing the service quality and speed of delivery. The company must also ensure the use the updated and recent technological tools, such that the consumers feel comfortable while buying the product (Galician, 2013). Porters five force model Porters five force model assists in gaining a deeper insight about the industry in which the company operates (Dobbs, 2014). Bargaining power of suppliers The bargaining power of the suppliers is extremely less. Firstly the brand name of McDonalds is very strong that it automatically gives the company an upper hand in front of its suppliers. Secondly, there are a large number of suppler and hence the competition among them is much higher. Thirdly, despite the existence of many franchisees McDonalds has not done vertical integration of its suppliers which means that different franchisees have their own set of suppliers. This reduces the suppliers power to bargain significantly. Bargaining power of buyers The buyers power to bargain remains incredibly high. Due to the vast extent of the fast food industry, the power of substitution remains very high. There is enormous competition in the industry from both organized and unorganized players of the industry. To increase the buyer power even further, the cost of switching brands is negligible for consumers and hence the risk is much larger for the company. Threat of substitution Substitution is a massive concern for McDonalds. There are many players in the market. The unorganized market is ever flourishing. And the cost of switching for buyers is negligible. Moreover, the switch in people to a healthier lifestyle has also led to the birth of various healthy eating options which has increased the threat of substitution. SWOT Opportunities The following opportunities are present before McDonalds and if the brand puts efforts in the given direction then it will not lead to increased productivity but also a larger customer base: Outlets of McDonalds can be made more attractive with more comfortable seating capacities and larger play areas for children in all their outlets. The brand must work towards enhancing the number of 24 hour open outlets. This would enable them to serve a larger customer base. Healthier options should be added to the menu in order to cater to the health conscious segment of the society. Threats This covers those aspects in the industry and environment which are expected to adversely impact the sales and brand value of McDonalds. Slowing overall economy can pose a threat by decreasing the disposable income of people. Large number of competitors in the organized as well as unorganized sector are the biggest threat to the sales of McDonalds products. Increasing obesity has led the government to discourage the consumption of fast foods. The changing lifestyle of people and their prominent switch to healthier food has also posed a significant risk to the brand. Ethical issues in business Ethics form a crucial aspect of any business. Without this, the business cannot expect to survive. Every organization has set different ethical standards for itself. In the long run of any firm, it is only natural for the firm to face ethical issues. However, addressing those issues in an effective manner is very crucial to the success and brand value of the business (Crane Matten, 2016). As a business, McDonalds must ensure the following ethical standards at all costs: The brand must ensure a sustainable supply chain management in order to make sure the raw materials are provided in time and of the best quality. The suppliers of McDonalds must strictly follow the ethical code of conduct provided to them. The nutrition and wellbeing of the customers is the top priority of the brand. The food as well as the caf premises must meet all hygiene standards. As a brand, McDonalds must not adversely impact the environment and hence it should have an effective waste management as carbon footprint reduction system. McDonalds must not create any kind of discrimination on any kind of basis including that of caste, creed, race, sex or gender. All the employees must be fairly compensated. Four ethical rules of business decision making Utilitarian rule: This implies taking an action or implementing a decision which is expected to have the largest positive impact over the highest number of stakeholders (Weiss, 2014). Moral rights rule: This depicts that individuals of the business take decisions based on fundamental rights and moral responsibilities. Justice Rule: This rule implies that decisions must be made by keeping in mind what is fair by societal standards. Practical: This rule keeps in mind the practical ethics. This signifies that no particular set of rules can apply to all situations. Hence, the practicality of the situation determines the decision made. Stakeholders of the organization Stakeholders indicate all the people who are directly or indirectly related to the organization. In the case of McDonalds, the following are the key stakeholders of the business: Consumers of fast food Suppliers of raw materials Competitors Media channels Franchisors Real estate agents Government parties Bankers Investors Trade unions Employees Insurance firms Corporate social responsibility Corporate social responsibility or CSR of any organization forms an important part the business. This CSR has been providing opportunity to businesses so they can add value to the society and therefore increase the companys productivity as well as customer service in the same process. There have been many approaches to explain the corporate social responsibility of businesses. Some companys conduct these activities to create some value in the society on the other hand some firms conduct these owing to the legal implications of the issue (Carroll, 2015). However, many firms across the globe have put tremendous efforts and have successfully made a mark in ensuring that the world today is a much better place because their CSR activities. As a part of its CSR activity McDonalds is always looking at reducing the waste generated at their outlets. Low energy LED bulbs and energy saving equipment are used across all the outlets. Cooking oil is recycles frequently and biodiesel is used to fuel over half of the delivery trucks. Organizational culture Organizational culture forms a crucial part of any business. It clarifies how the information would be traveled within the firm, how tasks are allocated and how the decisions are made. This culture represents the collective set of values, beliefs and ideologies of the business (Alvesson, 2012). It is important that the organizations put efforts in preserving their culture. The culture covers various components like departmentalization, delegation of responsibility and authority, transparency in communication and even decision making. The mission and vision of the organization as well as the people hired directly impact the culture of the business. Types of organizational culture There are four types of organizational culture as given below: Clan oriented cultures in an organization are like a family that focuses on doing everything together and towards a shared goal. Adhocracy oriented culture are more entrepreneurial in nature with a significantly high focus on risk taking and innovation. Market oriented culture focus on competition and delivering results and achieving higher goals. Lastly, Hierarchy oriented cultures lead to structured organizations with immense control and focus on efficiency. Resistance to change of organizational culture Resistance to change is natural in organizations. Employees often put efforts and get themselves accustomed to certain aspects of the business. There are various reasons why employees resist to organizational change. These are as below (Alvesson Sveningsson, 2015): Loss of status Surprise or fear of unknown Mistrust in the organization Fear of failure Fear of inability to adjust Organizational politics Poor timing Poor execution of change Conclusion This report covers various aspects of management which aim to provide a basic introduction to management. The first part of the report covers different managerial approaches and functions of a successful manager. This is important to every organization as it is crucial to understand the approach used by the managers and the approach that the organization requires. Any discrepancy in the two would lead to problems in the organization. The next part of the report covers the importance of macro environmental analysis. This is crucial in order to keep in terms with the on-goings of the business, industry and competitors. This keeps the business on its toes and leads to a better performance. Strategic management tools like SWOT, PESTLE and Porters five force model has been applied to McDonalds for better understanding of the same. Every business often goes through various ethical issues at different stages of the business. The four rules of ethical business decision making have been elaborated in the report. As a part of ethical business practice, corporate social responsibility plays an important role and leads to betterment of the society at large. Last part of the report focuses on organizational culture, its importance and reasons behind resistance to change in the organizational culture. Culture of the organization is very crucial for the success of the business. This leads to effective decision making and transparent communication within the firm. References Alvesson, M. 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