Implementation of Corporate Social Responsibility - Essay Example

Business Strategy Questions Corporate Social Responsibility and Strategic Implementation ____________ Name: _________________ Course ID: _______________ Dated: May 11, 2007-05-11 Implementation of Corporate Social Responsibility Social responsibility is a major subject of concern and action for all but the smallest or least aware of companies. Today it is generally accepted that business firms have social responsibilities that are perceived by the managers a lot more than what it was perceived in the past, and was commonly referred to simply as the 'business economic function'. In earlier times managers, in most cases, had only to concern themselves with the economic results of their decisions. Today managers are bound to perform their duties while considering the social impact and repercussions of their businesses reflecting each of their decisions. In many companies and organisations, however, this area of social responsibility is often not identified as a major or separate functional area; instead the responsibility is vested on an individual or managing staff, which frequently performs within the human resources management area. (Anderson, 1989, p. 15) Most companies find it no simple matter to formulate and implement socially responsible actions and programs; however, all companies must become concerned and involved in this area. To operate without major disruptions, a company must at all times be in compliance with legal requirements international, federal, state, and local. It must develop, establish, implement, and police a code of ethical and moral conduct for all members of its organisation. In the area of implementing activities on behalf of CSR, where there is considerably more latitude of operations in how, when, where, and even if the company or division wants to contribute money or other resources to 'worthy causes', the firm must deliberate about and resolve many questions prior to establishing fair and workable guidelines. Gone are the 'showing damn to public' attitudes once held by some companies. With a more active government and populace, company social responsibility in each of the three major areas has continued to gain greater concern and prominence over the past several decades. Social responsibility will continue to take more time, money, consideration, and concern in all future management decisions and actions. Diverse managerial skills, ranging from simple to highly complex, are required in all of these areas of social responsibility. It is the social and moral responsibility of an organisation to consider and recognise the rights or interests of various stakeholders first, not only stockholders and employees but also outsiders affected by the company's actions. Among outsiders include customers, suppliers, governments, unions, competitors, local communities, and the general public whereas stakeholder groups justifiably expect and often demand that the firm satisfy their claims in a responsible manner. In general, stockholders claim appropriate returns on their investment; employees seek broadly defined job satisfactions; customers want what they pay for; suppliers seek dependable buyers; unions seek benefit for their members; local communities want the company to be a responsible citizen; and the general public expects the company's existence to improve the quality of life. To be successful in today's business environment, which is dynamic and complex at the same time, organisations must attempt to incorporate the interests of these groups when defining their strategy or making business decisions. (Sims, 2003, p. 40) To build an enduring and resilient competitive advantage, an organisation must establish strong relationships with all of its key stakeholders due to the fact that no organisations in today's infrastructure can afford to ignore certain other specialised and highly influential groups which include government agencies that look at organisation compliance with regulatory standards, financial-ratings agencies that monitor economic performance, corporate-conscience agencies that evaluate social performance, and consumer agencies that assess product quality. Most of these groups enjoy lots of analytic resources and often have access to better information than ordinary stakeholders. Their opinions significantly affect the way an organisation is regarded by its less-informed observers. Indeed, a whole performance assessment and reputational-building industry has evolved that scrutinises, evaluates, and champions organisations. (Sims, 2003, p. 75) According to Robert Ackerman's studies, successful implementation of these programs takes place in three overlapping phases, commitment phase, learning phase and institutionalisation phase, and can take up to eight years from inception to completion. (Robert, 1975, p. 23) A committee or organisation studies evaluates and prepares legal interpretations, practices and codes of moral and ethical conduct to be adhered to by company employees. (Anderson, 1989, p. 22) CSR is a systematic approach which puts the onus on general management to positions and captures the latest business firms in a rapidly changing and complex global environment. To do so successfully, corporate leaders should install organisational processes that can help them understand how the environment might be changing and what the effect of likely consequences will be. Otherwise, despite their current strengths, business firms are unlikely to be able to meet the challenges of the emerging high-technology and deregulated global economy. Predicting a world in which technology and collective and competitive patterns change at an unprecedented rate is hard enough. Moving ahead of it is simply larger than the extended talents and resources that are now available in any of the world's leading firms. (Acar, 1995, p. 24) Perceptive approaches to strategy support the necessity of problem framing. Some of these provide an indication of how to frame organisational problems in practice, often through a process of uncertainty dilution. Such is the process used in strategic assumption surfacing and testing (SAST), a noteworthy approach to strategy making. (Mason & Mitroff, 1981, p. 11) The premise underlying SAST is that modern managers are confronting to constant changing conditions and environmental turbulence and that under the condition of environmental turbulence, under which problem framing becomes at least as important as problem solving. Conventional problem-solving techniques address well structured problems among which strategic planning methodology proceeds from stakeholder assumptions to data to strategy design. To gain a depth of perspective, SAST proposes to work initially backward from the strategy to the data to the underlying assumptions. Strategic Implementation - the Director's Role Using the term strategic management to denote the whole process of innovation, strategic analysis, formulation and implementation emphasises the continuous nature of the process and makes it much more likely that any strategies which are decided on will actually be implemented. For some voluntary non-profit organisations, indeed for any organisation, the greatest weakness in relation to strategic planning is probably in the implementation phase, or, rather, the non-implementation phase. All too often a one-off plan is drafted, even including many of the elements given above, but it then sits in a filing cabinet for a few years until someone, often an evaluator or a new chief executive or chair, comes along who thinks it is time for a new strategic plan, and so on. (Courtney, 2002, p. 210) This is not only a problem of implementation, it is also a problem of formulation, because the plan does not include a number of elements that are key to ensuring that the plan is implemented and regularly revised to take into account changing circumstances. As Bryson (1995) states: "Creating a strategic plan is not enough, one must develop effective programs, projects, action plans, budgets, and above all implementation processes that brings life to the strategies and create real value for the organisation (or community) and its stakeholders". (Bryson, 1995, p. 56) One of the key criteria for an activity being strategic is that it requires significant resources. One of the first of the crucial elements in strategic implementation, then, is consideration of the resource implications of the plan that has been drafted, i.e. to ask what resources will be required to ensure that the plan can be implemented fully. The resource implications include physical resources, human resources, systems and procedures and financial resources. Bryson (1995) argues that budget decisions are critical to strategic implementation and often 'represent the most important and consequential policy statements that non-profit organisations make'. Having developed a budget that puts a price tag on the strategic plan, the monitoring of this requires an appropriate financial management and reporting system (Oster, 1995, p. 21), yet, as Anthony and Young (1984) suggest, the financial controls in many voluntary non-profit organisations are inadequately sufficient. (Anthony & Young, 1984, p. 132) The most important issue in strategic implementation is that of 'monitoring' the process, which no one other than a managing director can perform. No matter how good a job one does in initially selecting a change strategy and tactics, something unexpected will most likely occur during implementation. Only by carefully monitoring the process can one identify unexpected events in a timely fashion and react to them intelligently. (Mercer, 1991, p. 9) The managing director acts as an input manager and can also work together as a team. They coordinate business transactions, including new capacity additions thereby strengthening organisation's capability. They possess the rights to negotiate with a consortium of funding agencies and networked public organisations over alternative funding schemes. (Acar, 1995, p. 166) The directors' focus on strategies that are consistent with its stated mission, yet provide acceptable levels of risk. Therefore the directors' take active part in monitoring strategic development process which capitalise on the most important external opportunities and internal strengths, while avoiding the most serious external threats and weaknesses. At the same time, however, they highlight on strategies that address organisational strengths and weaknesses and stretch the organisation to new heights should also be considered. Generally, more strategies will be developed than an organisation has the resources to implement. Prioritising the strategies is critical to developing a realistic implementation plan. (Mercer, 1991, p. 73) MBO helps directors' understand their role in achieving target levels of strategic performance. This clarifies the kind of work required for strategic productivity and lets people know what is expected of them in terms of results. Managers should emphasise what must be accomplished instead of what is to be done. Doing a job is not the same thing as achieving an intended objective. It is the duty of managers to point subordinates in the right direction (i.e., accomplishing part of the strategic plan) and create a results-oriented work environment. (Arthur, 1984, p. 227) Strategic implementation is facilitated when tasks and job activities are directed toward accomplishing the strategic plan. When an organisation focuses its efforts on carrying out its strategy and achieving objectives, the chances for accomplishing the strategic plan are increased. To achieve the results intended by the plan, an organisation must set its strategic objectives as a priority for achievement which formulates the basis for what management-by-objectives is all about. For MBO to facilitate implementation of the strategic plan two things are required, the management must make sure jobs are defined in terms of results to be accomplished and according to the descriptions of duties to be performed. This keeps the focus on accomplishment of the strategic plan. Second, management must not stray from the principle that 'doing a good job' means achieving strategic objectives. Any other standard will not serve to facilitate strategy implementation but will instead channel energies in other directions. (Thompson & Strickland, 1998, p. 225) The final implementation of the strategic plan involves the initiation of the several action plans designed at the functional level, their integration at the top of the organisation, and a kickoff of the strategic plan. This may involve new services, initiation of management development or technical training, new revenue sources, or alternative service delivery approaches. In effect, implementation is the step at which the strategic plan is handed from the planning team to the functional managers and, as appropriate, to the community. All parts of the organisation should feel that there is activity on all levels that will bring about the successful completion of the organisation's mission. The most important test of implementation, however, is the degree to which organisational members, especially managing directors, integrate the strategic plan into their everyday management decisions. A strategic plan is whenever implemented, it starts with the initial response of a manager confronted by a decision to consider whether an answer is found in the organisation's strategic plan. Although guidelines for every decision are not provided by the planning process, consideration of the plan as a first step is the best evidence of the plan's implementation. References & Bibliography Acar William, (1995) Scenario-Driven Planning: Learning to Manage Strategic Uncertainty: Quorum Books: Westport, CT. Anderson W. Jerry, (1989) Corporate Social Responsibility: Guidelines for Top Management: Quorum Books: London Anthony, R. and Young, D. (1984) Management control in non-profit organizations, Irvin Arthur A. Thompson Jr., and A. J. Strickland III, Strategic Management: Concepts and Cases Plano, Tex.: Business Publications. Bryson, J. M. (1995) Strategic planning for public and nonprofit organizations (2nd edn), Jossey-Bass Courtney Roger, (2002) Strategic Management for Voluntary Nonprofit Organizations: Routledge: London. Mason R. O. & Mitroff I. I. (1981). Challenging Strategic Planning Assumptions. New York: Wiley Mercer L. James, (1991) Strategic Planning for Public Managers: Quorum Books: New York. Oster, S. M. (1995) Strategic management for non-profit organizations: Theory and cases, Oxford University Press Thompson and Strickland, (1998) Strategic Management: Routledge: London. Robert W. Ackerman, (1975) The Social Challenge to Business (Cambridge, Mass.: Harvard University Press) Sims R. Ronald, (2003) Ethics and Corporate Social Responsibility: Why Giants Fall: Praeger: Westport, CT. Read More