Dubai Refreshments PSC - Case Study Example

Dubai Refreshments PSC Name Goes Here: Name of University Here: Introduction In management, when stakeholders’ needs, concerns, opinions, and perceptions are identified early enough and interpreted into apposite, consequential requirements alongside which different solution may be appraised, opposition from stakeholders is significantly reduced and mutual consent can be realized. It is important to emphasize that it is unrealistic to try to attain the goal of gaining active support from all stakeholders, i.e., unanimous agreement by all stakeholders. In practice, stakeholders may give their consent in spite of unrelenting opposition on a given project even after being shown that the proposed solution to a problem is important. In this report, we identify Dubai Refreshments PSC’s stakeholders by keeping in mind that not all stakeholders will perceive our project of overhauling the two distribution warehouses that are not meeting international standards as beneficial. The project represents a considerable cash investment, and will mean that 50 employees will be fired. Whether the opposition of negative stakeholders comes from real or unreal factors, it is apparent that these negative stakeholders cannot be ignored. This report will identify stakeholders from four groups: Regulatory Authorities, Business Partners, Employees, and International Industry. There is need to identify these stakeholders, determine the source of their opposition, and to develop stakeholder management strategies that will address their issues and mitigate the risks their pressure and opposition can create. The ever-increasing scope and goal of the company’s projects require a dedication to dialogue and cooperation with a number of stakeholders. As the management we believe that open and transparent dialogue is critical to long-term success. Identification of Stakeholders In order to identify the company’s stakeholders it is necessary to focus on both the formal structure of Dubai Refreshments PSC and informal relationships and partnerships. This report utilizes a visual model for this purpose, where the stakeholder environment is visualized using a set of inner and outer circles. From the model below, the inner circles represent the most important stakeholders whose influence on Dubai Refreshments PSC is highest. The exhibit below serves to provide a general overview on the possible stakeholders of Dubai Refreshments PSC and their impact. It is imperative to note that this report uses stakeholder analysis as a tool for evaluating Dubai Refreshments PSC strategies. The rationale is that different individuals and groups may have their own perceptions in different situations. For instance, labor interest groups will have a high interest in staffing decisions; while environmental regulatory groups could, however, have an exceptionally high influence when it comes to decisions involving plant location. Exhibit-1: Stakeholder identification Dubai Refreshments PSC’s stakeholders are identified from each of the following stakeholder groups as listed below. Each of the stakeholders is identified to help the company deal with the outside pressure: a. Regulatory Authorities (Local Authorities) In the analysis of stakeholder power especially in terms of their influence on people and developments, it is important to assess, to which extent these stakeholders will exercise their power. The impact of Local authorities on Dubai Refreshments (PSC) is very high. If the Dubai Refreshments (PSC) plans to overhaul its two distribution warehouses that are not meeting international standards or move it’s headquarter; then these decisions should also meet local standards. This is where local authorities would probably have significant influence on this decision. Nevertheless, their interested will also be in knowing about important business developments, including introduction of new product lines and new marketing and promotional campaigns among others without taking any action. b. Business Partners (Al Wathba Company) Recently, Dubai Refreshments (PSC), a sole distributor of PepsiCo products signed a 5-year agreement with Al Wathba Company for Central Services (PJSC). A partnership with Al is meant to provide efficient fleet services for the distribution of Dubai Refreshments (PSC) beverage products. The move was part of DRC's efforts to restructure its key operations and to focus on its core business of manufacturing carbonated and non-carbonated beverages as a franchise of PepsiCo trademark in the Emirate. Under the terms of agreement, AWCCS will make available 170 vehicles including trucks to Dubai Refreshments (PSC), and maintain the vehicle as well as managing fleet operations. Al Wathba Company for Central Services (PJSC) are important business partners because they not only posses knowledge and skills on fleet operations but are strategic partners in distribution. c. Employees (Heads of Departments) This year, 2011, Dubai Refreshments PSC aims to celebrate its golden year in the Emirates and Dubai. The company endeavors to maintain its leadership in the beverage market through successful distribution of its products. This is expressed by the current managing director, Mana Al Mulla, who believes that DRC’s maturity has been fast paced over the last fifty years, witnessing a successful expansion of its products and brand portfolio. The success can be attributed to the management team and the rest of the employees who have been adroit in implementing the company’s strategic plans. The company’s hierarchy (formal power) including employees in senior positions as well as influence (informal power), in terms of leadership style. Employees serve well in controlling of strategic resources for instance where they are responsible for the company’s strategic products. In addition, employees’ posses’ knowledge and skills in terms of expertise that forms the organizations core competencies. Heads of Departments are also responsible for controlling the company’s internal and environment for instance networking with external stakeholders. Also, Heads of Departments as key stakeholders are directly involved in strategy implementation; they are expected to be agents of change or responsibility in the implementation of strategic projects. d. International Industry (PepsiCo) PepsiCo is a major stakeholder for Dubai Refreshment (PSC). The influence of PepsiCo can be felt in the strategic audit that requires the overhauling of the two distribution warehouses that are not meeting international standards. The project represents a considerable cash investment, and will mean that 50 employees will be fired. The influence of PepsiCo can also be felt where it exchanges important business information with Dubai Refreshment (PSC). For instance, the recent hike in PepsiCo products has already been implemented by Dubai Refreshment (PSC). After exhausting all the available means to take up incremental cost of inputs, production and distribution, Dubai Refreshment (PSC) was not able to economically keep its current pricing structure. Dubai Refreshment (PSC)’s, Trade Manager, Scott Taylor, announced this decision in a letter to traders clearly communicating the company’s decision. The bottling and distribution company has communicated to retailers in line with the PepsiCo’s revised prices. Therefore, PepsiCo is a major stakeholder that can help Dubai Refreshment (PSC) in dealing with external pressure. Stakeholder mapping This report will utilize power/interest matrix in mapping the stakeholders identified above. The power/interest matrix is a practical tool for the assessment of the expectations and the impact of the identified stakeholders. With the power/interest matrix, this report answers questions related to the following issues: The level of interest of each of the identified stakeholder to impress their expectations on Dubai Refreshment (PSC)’s decisions; the means they have in doing so; and if they really have the power to do so. As intended, the power/interest matrix presents useful information on how to deal with particular stakeholders. The model also indicates if the decision to overhaul the two warehouse and to send 50 employees home will receive support or resistance, and which specific stakeholders must be included in the decision making process. Exhibit-2: Power/Influence Matrix High POWER Low Low INFLUENCE High Stakeholders in sector A have low interest in Dubai Refreshment (PSC)’s plans and they lack the power to exert significant impact. Dubai Refreshment (PSC) should keep these groups informed, but should not pay much attention to them. Stakeholders in Sector B have a high interest in Dubai Refreshment (PSC) and its actions. Nevertheless, this group has limited power to influence the actions of the organization. Despite their low level of influence, such stakeholders are potential allies in important decisions. For that reason, it is advisable to keep them informed on issues of their interested. For the stakeholders in sector C, Dubai Refreshment (PSC) could find it difficult to relate with them. In this group, there are corporate investors and regulatory authorities (in the case above we have Local authorities). These stakeholders in most cases and show a low interest in corporate affairs yet they can exert significant impact on Dubai Refreshment (PSC) especially when it comes to matters of location and warehousing construction. Therefore, it is necessary to analyze potential intent and response of these stakeholders in the overhauling of the warehouse, and to involve them in all major developments in line with their interests. The main stakeholders are those in sector D; they have high interests and high power. The stakeholders found in this sector are Business Partners (Al Wathba Company), Employees (Heads of Departments), and International Industry (PepsiCo). These stakeholders must be involved in all major developments including the overhauling of the two warehouses. The effectiveness of the management and leadership of Dubai Refreshment (PSC) The leadership and management of Dubai Refreshment (PSC) is very effective in dealing with changes in the business environment and profiting from the opportunities arising in various functional areas of businesses. The company’s ever growing business is an indication that the management is able to implement strategies that are effective in yielding multiple business benefits for the organization. Overhauling the two warehouses will effectively increase the company’s storage and dispatching capacity, besides significantly improving customers’ response time. In addition, the company’s products are popular, thus, creating more space will ensure that an increase in demand is well serviced with the necessary infrastructure. The management also encourages diversity in the workforce which enriches the working environment leading to greater creativity, enhanced leadership effectiveness, augmented self-actualization, job satisfaction, and better engagement with major partners and external stakeholders. Even from an individual’s perspective, the management of Dubai Refreshment (PSC) believes that a culture of diversification creates an environment that is devoid of artificial barriers allowing people to be at their best, to make a difference and to enjoy their work. The management also believes that strong teams are made even stronger by the diverse background, skills and views of its workforce. The role of management and leadership of Dubai Refreshment (PSC) in maintaining corporate growth, and in adapting to the changing environment Dubai Refreshment (PSC) main role is to provide clear direction to the employees so as to make feel like they are part of the company’s success and they can make a difference. The management also helps in creating a well networked market achievement culture through the development of highly engaged teams so as to make Dubai Refreshments a wonderful and enjoyable place to work. Though this, the management ensures that corporate growth is sustained, and immediate adaption to the changing environment is guaranteed. The management also demonstrates a constructive style in helping others to develop and grow, this ensures that the company attracts and retains great people. Also, the management is responsible for delivering results for today and in laying down the foundation for tomorrow’s success. This is made possible by effectively using management skills for setting goals and stretching them, holding people accountable and marinating disciplined processes that evaluate achievement. The role of management and leadership of Dubai Refreshment (PSC) in maintaining corporate growth, and in adapting to the changing environment is to ensure that its people are passionate about the company’s brands and consumers. Ideally, the management and leadership must get involved, to identify mistakes and to learn from them and to offer practical solutions. Read More