Strategic Management : Goodwill Industry - Term Paper Example

? Strategic Management Paper: Goodwill Industry Strategic Management Paper: Goodwill Industry Introduction and Company Overview The Goodwill Industry is an international non-profit organization which provides employment placement services, job training and undertake other community-based programs. The industry operates within a network that consists of 179 community-based organizations in the United States. These community-based programs are accessible to those who lack an educational background, the disabled or unemployed in the society. The founder of this industry, Edgar Helms, founded the company in 1902. The company’s logo is a letter “G” which is similar to a smiling face that was designed in 1968 by Joseph Selame (Goodwill Industries International, 2012). Reports show that the company is majorly funded by the network of thrift stores that also operate as non-profit organizations all over the region. This paper will discuss the overall strategic management system of the Goodwill Industries International. Mission Goodwill is aimed at enhancing dignity and civilizing the value of the lives of individuals, relatives and communities worldwide. This is achieved by eliminating the barriers that hinder other individuals from accessing opportunities depriving others from realizing their full potential through working (Goodwill Industries International, 2012). Goals Goodwill has a variety of goals that it strives to achieve. Such goals include enabling every entity to achieve maximum potential through education and job opportunities. The company mostly helps those who are needy in the society. The charity is also enhanced through contributions that are made by other individuals from all parts of the world (Goodwill Industries International, 2012). Objectives The company’s objective is aimed at enabling most human beings to have the chance to attain their full prospective. This is achieved by Goodwill’s participation in contribution, based on all aspects of life. Also, the company provides supportive services that enable the disadvantaged in the society to seek greater independence. Strategic Posture Goodwill International Industries was formed in 1902 by Edgar Helms. The company served the whole global village on charity basis. The company has several organizations in Canada, the United States, and 14 other countries. The founder, who was an early social innovator and a Methodist minister, used to collect and gather clothing and other household goods from the wealthy cities. Afterwards, the collected items were distributed to individuals who were needy in the society. In 1915, Edgar Helms hosted a visit to the Morgan Memorial Centre with the assistance of representatives of a workshop mission which was in Brooklyn, New York. They learned the operational techniques of the Memorial Inc. and after this Helms was also invited to visit New York (Goodwill Industries International, 2012). The two groups exchanged ideas, and Helms proposed the naming of his workshop, Goodwill Industries. Nowadays, the Goodwill Industry has become a multi-billion non-profit organization. From the company’s earnings, around 84% of the revenue goes to the provision of support services and other forms of training to over 2.5 billion individuals. The founder even describes the program as a resource provider for the unfortunate in the society. The charity industry in the contemporary world is trying to fight poverty through similar mechanisms that are applied by the Goodwill Industries. Furthermore, the world’s Charity Watch has rated this industry with an “A”. By 2011, Goodwill Industries had 165 members in the United States continent. Goodwill also has an Internet auction site and another one on eBay where valuable items are put on sale. In addition, the industry also has more than 2,600 Goodwill retail stores that are liable for items that are sold on the auction site (Lenoir, 2000). Some of the most valuable items that are sold include jewelry, books, automobiles, furniture, clothing and other machinery. From these auctions, the industry earns over $2.7 billion. The corporation also receives some of its revenue to help in the business world. This is as seen from the labor shortages, limited space, and equipment that are eliminated by the Goodwill industries. In some cases, the industry also provides job opportunities to the skilled and unskilled individuals in the industries to meet business demands. In 2010, Goodwill Industries enabled individuals get jobs in business sectors like the IT, banking, and the health care field (Goodwill Industries International, 2012). They normally offered services such as transit, education, and health care services among others. In circumstances when the goods cannot be sold at the auction site, they are taken to a Goodwill outlet or any bargain center for sale. The items are sold in terms of the weight. One pound of an item ranges from $0.49 to $1.69 depending on the country that it is being sold. The current president and CEO of Goodwill Industries International, asserts that the organization is a ‘match’ to unite local employers and participants of the program to generate productive citizens from long-lasting job relationships. Environmental Analysis In the business industry, there are five strategic analyses that are liable for the success of any company. These strategic forces comprise of the PESTLE framework, SWOT analysis, resource analysis, MOST analysis and Porter’s 5 forces model (Giloth, 2004). According to the strategic management of Goodwill industry, Porter’s five forces analysis model is of significance. These five forces are stated in terms of reasons. They include reasons for threat from buyers, reasons for threat from suppliers, reasons for high probability of substitute products and services, reasons that attract new entrants in an industry, and rivalry among the companies. In addition, this industry faces stiff competition just like most of the markets in the current economy. The main competitors of the Goodwill Industries are the finest retail stores that include Wal-Mart, Kmart, and Ross among others. Additionally, the proximity of Goodwill’s thrift stores to outdoor malls also creates stiff competition to the industry. In conclusion, the environmental analysis of the industry shows that Goodwill Industries are competitive in terms of offering charity work. Information contained in Goodwill’s 2012 newsletter shows that the company recycles clothing, stuffed animals, metals, cardboard, and computers. These items are gathered in large amounts. According to the newsletter, in a typical month, the company recycles over 280,215 pounds of the items mentioned. This adds up to 3,362,580 pounds of recycled material per year. Internal Analysis The services offered by Goodwill are a clear depiction that the community has people with needs. In most countries, the Goodwill industry trains the potential employees on the available jobs. The main jobs that are offered to the community members are in warehousing, logistics, fleet management, and packaging services among others (Goodwill Industries International, 2012). Through all these jobs, the Goodwill industry earns a lot of money from the auction businesses and the employment opportunities that it offers to the unfortunate in the society. The global presence of the company has also grown significantly, as seen from its history of success since it was formed. Goodwill’s model of self-sustainability is supported by the presence of many local stakeholders in the charity industry. The organizational structure of the organization comprises of the executive director, secretary, and finance director who are the principal leaders of the organization. Other includes the sales director, the store managers, contract employees, plant supervisor, drivers, the recycling employees, store clerks, and the program participants. All these individuals play a modest role in the governance of the organization’s roles and responsibilities. The organizational chart presents the information outlined. Organizational Chart The Goodwill Industries are quite different from other industries in the business market. This industry maintains an open work environment which is positive to the society in overall. This shows that they have a fully inclusive cultural practice. In business, culture begins with the sustenance of a company’s values and the organizational system. In relation to the Goodwill industries, culture is treated with vitality through concepts like the servant leadership approach used. The leaders of this organization are responsible for nurturing the employees in order for them to succeed (Lenoir, 2000). To embrace this culture, they are to be authentic, vulnerable, present, useful, and tolerant. SWOT Analysis In the charity industry, SWOT analysis is a strategic planning technique. This entails the study of strengths, weaknesses, opportunities and threats of an organization (Lenoir, 2000). The improvement of the industry is mainly based on the recognition and improvement of the organization’s weakness, exploiting the opportunities, and capitalizing on the strengths. In general, the strengths and weaknesses are covered with the business itself while the opportunities and threats are caused by other external factors. As for the Goodwill Industry, the strengths are considered as the company’s advantage over its competitors. The strengths can include efficient machinery or skilled manpower. On the other hand, weaknesses can also be seen the company. This can be accomplished by establishing the absence of potential strengths and assessing some of the strengths that are considered as weaknesses (Giloth, 2004). Also, Goodwill’s opportunities are listed under the SWOT analysis. The SWOT analysis factors are of considerable significance to the growth of any company. The SWOT analysis shows that the threats and opportunities of Goodwill are given higher priority while the weaknesses and strategies are of less priority. Some of the threats that are posed to Goodwill include growth of the thrift stores, competition from other stores, national discount retailers, and proximity of Goodwill’s thrift stores to leading retail centers, as well as the economy. The competition originates from new malls, consignment stores, and other leading retail centers like Wal-Mart and other retail shops. Moreover, the presence of trade shows, flea markets, and summer garage sales affect the Goodwill Industries in a significant way. However, the Goodwill Industries also have their opportunities in the business arena. Some of the opportunities of the Goodwill industry include the increased mission awareness of the industry, connection with the neighborhood, momentum from the thrift store sales, work trends, and growth of other new markets (Lenoir, 2000). The markets include the Asian, Hispanic, and New Residents. In the United States, Goodwill is graded as the second best in store sales. All organizations and institutions have weaknesses and strengths. This is no exception to the Goodwill industries. The most common weakness that the Goodwill Industries face as a charity organization is associated with the business market. Firstly, the cost of advertising the Goodwill business in the Denver market is extremely expensive. This is brought about by the fact that Denver is a high income market. In addition, Goodwill faces competition which is also a weakness to the general attraction of customers. Lastly, most of the industry’s staff lacks clear understanding of the store’s mission (Giloth, 2004). In the conclusion of the SWOT analysis, one can evidently see that the Goodwill Industries have a variety of strengths that have maintained its success in the business market. Some of the most common strengths of Goodwill are linked to the buyers. These strengths include Denver’s boost and buyer’s impression of the thrift shops. Most of the Goodwill shops are run as thrift shops, which appear to be trendy, hence; most buyers are attracted to carry out their shopping with the Goodwill industries. Moreover, the Denver market has significantly boosted the growth of the thrift stores through the advertisements. The stores are said to be appealing, and comprise of a comfortable environment, therefore, they serve a variety of individuals all over the globe. Strategic Direction According to the SWOT analysis, there are strategic issues that are of vital significance to the industry. As stated above, the most common strategy analysis schemes that are used include the PESTLE framework, Porter’s five forces analysis, MOST analysis, SWOT analysis and resource analysis. In this setup, the PESTLE framework covers most of the aspects of the Goodwill industry. This strategic analysis stands for Political, Economic, Sociological, Technological, Legal and Environmental analysis. This framework focuses on a broad class of information from the individual constituents of the strategy. Through the PESTLE framework, tax policies, competition, employment laws, culture, ethics, information technology, climate change among other factors will be highly considered in the business (Giloth, 2004). There are other strategies that can be employed in the success of the Goodwill industries. One is a management strategy of tutoring senior employees. They can also use the resource analysis strategy that is helpful in the identification of a company’s strengths and weaknesses. This also falls categorically under physical, intangible, financial, and human factors. This promotes recognition of the brand and goodwill. In addition, the Goodwill Industries also took a step forward in the organizational scheme of the industry by naming a new president and CEO. John Miller who was the executive is now going to be succeeded by Jacqueline Hallberg. Miller had worked in that post for 30 years and is handing over his responsibilities to Hallberg who was also an employee in the industry for the past 22 years. Action Plan for the First Year In the first year of the implementation of the framework, there are several factors that are to be considered. These factors are normally entailed in the framework itself. As stated above, the framework consists of the political environment, economic environment, sociological environment, technological environment, legal environment and the environmental factors (Giloth, 2004). A clear analysis of the PESTLE is shown below. Political environment 1. Employment laws and regulations 2. Government laws 3. Tariff laws Economic environment 1. Commerce 2. Competition 3. Economic growth or depreciate 4. Wage rates 5. Cost of living Sociological environment 1. Culture 2. Work ethics Technological environment 1. Information Technology 2. Infrastructure 3. Researches Legal environment 1. Imports/ exports 2. Employment laws 3. Intellectual property Environmental factors 1. Climate change 2. Global warming effects Through this strategy, the Goodwill Company can attain its maximum potential in terms of earnings made from the thrift stores. If the staff members of Goodwill are able to look into the factors stated above in a sequential manner, then they are able to enhance the earnings of the company. This strategy will also enable the company achieve its objectives. This happens through initiating the project, hence; increasing the job opportunities in the organization, improving technology, and raising the overall standards of the society. This initiative will enable 20 million people to get jobs by 2020. The strategy also ensures that the workforce is strengthened to support the needy in the society. Furthermore, through the business, many people will get basic needs through the donations made by the company to various places all over the world. The implementation process will take place in phases. The implementation of the laws in the political environment will be performed by the board of members. In the economic environment, the task will be done by the finance director. Also, the sociological and technological phases are to be looked into by the board of executives. Furthermore, the legal environment phase can be achieved with the help of the program supervisors and directors. The financial managers can also help in the implementation of this stage. Lastly, the environmental aspect is expected from every worker of the industry. According to financial requirements, this factor has an estimated cost of approximately $26,000. Strategy Control In this strategy, the company is planning on employing strict measures that are to be observed by employees in the Goodwill industries. Some of the techniques include strict penalties, which are accompanied with lack of observance of the strategy regulations. This is done by the board of directors which in this case acts as a disciplinary committee to the company’s employees. Conclusion In conclusion, the Goodwill Industries have played a mega-role in ensuring the community fabric is intact. The industry was registered as a charity union in 1935 (Goodwill Industries International, 2012). This has enabled the creation of job opportunities to those facing employment barriers. The company is nonracial and does not consider the background of the person. The main goal of the company is to enhance productivity of most people in the community through the provision of support services. References Goodwill Industries International (2012). Goodwill Industries International. Retrieved from http://www.goodwill.org/ Lenoir, G. (2000). The network: Health, housing, and integrated services. New York: Corporation for Supportive Housing Publishers. Giloth, R. P. (2004). Workforce intermediaries for the twenty-first century. 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