Implementing Strategic Quality Change in an Organization - Pioneer Motors - Case Study Example

Name Tutor Course Date Implementing Strategic Quality Change in an Organization Introduction It is quite evident that organizations regardless of being public, private or non-profit constantly faces need to improve on quality. According to Dooris (123), every initiative based on quality management should be tied in key business processes so as to have a positive impact on productivity. Implementation of strategic change entails defining businesses long terms goals and reestablishing these goals so as to improve quality (Dooris, p123). It is due to this reasons that Pioneer Motors need to analyze its existing quality management whereby it will implement a strategic quality change widely incorporating necessary monitoring and evaluation processes. Company Analysis Pioneers Motors is considered to be a national automobile manufacturer. Founded in 1998, the company has employed about 40,000 who work in different fields within the company (Markoczy, p1020). It manufactures different kind of automobile ranging from trucks and cars across different cities. In today’s global and competitive automobile market, Pioneer Motors need to examine its existing quality management through creating an urgency regarding implementing a strategic quality change by constant monitoring and evaluation. Markoczy (1023) asserts that, with current economic crisis, Pioneer Motors faces the risks of not being the leader in the automobile industry if drastic measures are not taken in implementing its strategic change. Therefore, this creates a critical time for the company to clearly understand and work on its strengths, weaknesses, opportunities and threats. Vision Statement Pioneer Motors vision is being the world leader in the automobile industry. The company focuses on earning customer trust through constant quality improvement which is usually driven through innovation, integrity and teamwork. Proposed Vision statement Pioneer Motors will be the leaders in automobile industry in various alternate fueled cars and trucks and providing of advanced quality products and services that its global customers will realize quality and innovation in these products. Mission Statement Pioneer Motors mission is to enact positive improvements in their brands, market share, revenue, customers and cost through the use of implementing best practices and global common metrics. Proposed Mission Statement Pioneer Motors will become a renowned automobile industry internationally. This is through regaining its market share from foreign completion. Values Statement According Oreg (690), with the global economy undergoing a tremendous change, Pioneer Motors is experiencing changes from increased fuel prices and global warming. The company intends to use the described threats by making them opportunities through understanding changes in customers buying habits (Oreg, p680). Its quality strategic change will focus on customer perception, innovation, companies’ environment and product quality. This will be achieved through creating an image that describes both customer and environmental needs. Direct contact with customers guarantees successful implementation of strategic quality change. In addition, Pioneer Motors will provide its stakeholders with great pride and constant financial incentives thus remain within organization activities (Oreg, p693). Existing Quality Management within Pioneer Motors In Pioneer Motors, the following are some of the existing quality management ways that are used by this company as a way of maximizing and improving quality in their products and services (Russell & Gaby, p420). They include; Reduction on labor expenses: this ensures that excess labor expenses are channeled to other department ensuring quality distribution Cut on legacy costs Decrease in the company production capacity: this will ensure that the company produces goods that of great quality as opposed to quantity. Launching on new brands and establishment of strong marketing strategies: this entails ensuring that the customer has a variety while choosing for various products. From the above defined existing quality management ways within Pioneer Motors, the company need to realize that reducing cost that does not usually guarantee success among competitors. The company should understand that it should differentiate its products so as customers to obtain a sense of value added. Finally, Pioneer Motors must create an appeal to various trends and needs created by global markets before going global (Russell & Gaby, p 425). Problem Statement It is clearly that from the above analysis it is essential to ask what existing quality management do Pioneer Motors need to change through strategic implementation of quality? Further what is required in the company and evaluation system so as it can be able to achieve above average returns and improve its capacity to compete in this global economy change? Implementation process The firm will endear to have a competitive strategy which is aimed at attracting and maintaining customers while at the same time withstanding the competitive pressures that exist in the dynamic consumer market. This will enable the firm to strengthen its position in the market and generate a competitive advantage. The firm will have to increase its customer loyalty through increased communication thus being able to have an upper edge over its competitors (Ralph, 113). The competitive strategy will adapt five key business elements which include: The broad differential approach Low cost approach that is focused The provision of the best cost approach Differentiation approach that is focused Low cost leadership approach To achieve this, the firm has to scrutinize all the cost activities. The firm should be able to lower the performance and manufacturing costs per every financial year by venturing into developing cost effective automobiles and reengineering the activity costs. The firm has to increase its innovativeness to differentiate their products from the others thus being able to create value for their consumers by providing products that are not easily copied. In addition a successful differential strategy will enable the firm’s products are to have a premium price and have increased sales per unit. The customer loyalty to a brand will provide an entry barrier for other auto products thus being able to have a competitive advantage over the other automotive products in the market. This will be able to have the firm fend off threats of substitute products in the dynamic and competitive consumer market and create more room for diversification (Pettigrew et al, 231). The implementation process for the pioneer motors will cover three years. To begin with, in the first year, the firm will have to perform an analysis of the potential synergy among the existing auto brands. This will be done through a corporate organization and market research that will enable the market in determining and identifying the market segments for the remaining brands that have to be targeted (Shaw, 98). The firm has to phase out the auto brands that have been in the market for long and conduct an organizational change. The organizational change will involve the adaptation of channels that are willing and supportive to innovativeness that is geared at surpassing the needs of the consumers. This will include the formation of an information system that will enable the workers to be able to have their skills and capacity built while on job. The information system has to be updated to meet the growing needs of the ever dynamic competitive market (Pettigrew, 124). The management in collaboration with the workers has to institute strategic and tactical strategic decisions that are to be implemented. This will include the formation of workable communication channels that will not only collect the feedback from the workers and have their input in decision making but also from the consumers who will be able to shape t he firm to adopt new designs and technologies that are able to meet their demands in terms of operations, efficiency and durability. In addition to these, the firm is to develop yearly achievable goals, corporate visions as well as missions. The firm is to venture and invest heavily in new and innovative auto designs (Palmer et al, 146). The second and third year will have the firm introduce the newly developed and innovative brands in to the market. This will be done by development of new and consumer capturing marketing campaigns using varieties of visual, audio and audiovisual media. This will ensure that the consumer is aware of the new products and their efficiencies. This will also have the firm begin to have their inventories cleared. Secondly, the firm is to develop chain arrangements of supply that are of long term benefits. This will be done by being in close collaboration with their marketing chains that are in direct touch with their consumers as they will be able to provide reliable feedback to the firm on the performance of their products and the improvements that are required on them to maintain the competitive advantage (Oliver, 137). Thirdly, the firm management is to have a close monitoring of the transitional period which is mainly a shift from the rigid old unreceptive culture to a new and innovative organizational structure. This will be done through the adaptation of performance evaluation indicators which is to be achieved through the implementation of performance appraisals and assignment of clear and elaborated roles for the employees to avoid duplication of duties and overworking of other employees. The firm is to also develop a proper and sustainable motivation system for the innovative and exemplary workers. This will reduce the worker turnover and have workers that are highly motivated and have a direct positive impact on the attaining of the formulated organizational goals (Kotter, 189). Strategic analysis will enable pioneer motor company identify the options as well as opportunities that the company has at their disposal. Situational analysis will be driven by both the internal factors and the external factors. SWOT analysis will be vital in the evaluation of pioneer motors strengths, weaknesses, opportunities and threats. Internal factors will include the strengths and weaknesses that existing are within the organization. The external factors on the other hand will be composed of opportunities as well as the threats the pioneer motor company faces from the external environment or outside the organization. External factors (macro environment ) comprises of industry and competitive conditions that exist. The external factors will be able to show the economic dominance of the pioneer motor, competitive forces and also moves of the rival companies and how attractive pioneer industry is in the market as well as the factors that make pioneer motor company to be a success. Internal factors (microenvironment) on the other hand will be made up of organization’s internal situation and its competitive position (Armstrong M., 126). Strengths off pioneer motors identified through the existence of certain characteristics within the pioneer motors that enables it to have an edge over other motor companies .the strength of pioneer motors will be attributed to its financial reserves as well as capabilities for this will enhance increased production as well as improvement of quality and the hiring of personnel who have the technological knowhow. Technological knowhow is what makes pioneer motors to have the global reputation of being the pace setters in the innovation of new models in the motor industry. Pioneer motors enjoys a global network of supplies and distributor channels and this makes pioneer motors to get its supplies at low costs through the competitive bidding process and this means that the profit margins are widened due to spending less on raw materials to make its products (Armstrong M., 126). Weakness in pioneer motors will comprise those characteristics that make pioneer motors to become disadvantaged when compared to other motor companies. Pioneer motors values brands whose maintenance requires large investments and this creates a barrier towards advancements in innovative thinking to make even better models. The company also has a poor cooperate reputation for meeting the orders of the customers on time and this affects the future mutual trust the clients are able to have for the organization. There are numerous bureaucratic processes within the company and this causes the delays in the provision of good as well as services within the company which has greatly affected the productivity as well as the reputation of pioneer motors. Pioneer motors has not yet diversified to engage in the production of smaller vehicles due to inadequate experience and this has affected the sales being made especially in the European markets which mostly prefer the smaller vehicle models compared to the larger vehicle models (Armstrong M., 127). Opportunities include the external factors that make it possible for pioneer motor company to make great sales as well as profits. There is need for Pioneer motors to adopt the change in technology by being able to produce vehicles which have less carbon emissions as well as having less fuel consumption. This will enable the company not only to increase its sales but also penetrate to markets in other countries which have put legislations in place on carbon emissions which previously made pioneer motors not to penetrate such markets and make sales. Pioneer motors should also carry out effective marketing strategies to enable it penetrate other emerging world markets in order to increase its customer base. Effort should also be made to cut down the costs of some of its market brands such as “the Penguin” to make them more readily affordable by the target populations especially in the third world countries. Pioneer motor company should take advantage of the government subsidies such as reduction in export duty in order to achieve an increase in the profit margins (Armstrong M., 127). Threats would also comprise of the external elements or factors that make the existence of pioneer company to be in trouble. The world economic crunch has greatly caused fluctuations in the economy and this has greatly affected the sales that pioneer motors has been able to make especially in the countries which have been greatly affected. With the increase in the oil prices, the markets for the pioneer motor has been greatly affected due to a sharp reduction in the number of purchases of motor vehicles being made. Competition from other motor industries brings a challenge to pioneer motors since they all have to compete to meet the needs of market. Other companies have embraced current technologies not in the manufacturing process of which some are yet to be adopted by pioneer company (Armstrong M., 127). Work cited Dooris, Michael. Successful Strategic Planning, New Directions in Institutional Research, pg123, 2004. Markoczy, L. (2001). Consensus formation during strategic change. Strategic Management Journal, 22, 1013–1031. Oreg, S. (2003). 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