Strategy Development for Miller Group - Case Study Example

STRATEGY DEVELOPMENT IN RELATION TO A SELECTED CNP ENTERPRISE Introduction In any country's economic activity, the construction and property sector is considered to be a bellwether. The industry has huge reach and implications and works in non-residential, residential and engineering construction. The private-public sector participation in this sector is pivotal to it growth and elevated customer satisfaction levels. On account of the recent global economic downturns this sector has faced challenges due to multiple factors that include rising interest rates, banks showing conservative approach on lending, changing compliance and regulatory requirements, reduced confidence from the customers, labour shortages and supply issues, factors related to environment and technological shortfalls on account of a rapidly changing advances in technology. There are high stakeholder expectations surrounding the industry and since new influential players are making a foray into this sector, the companies are focusing on improving their overall image and revamping their setup in order to meet their operational and customer efficiency goals. Furthermore, since technology has attained a central role to play in any business, the construction and property sector too has, over the recent years, realised its potential to garner a competitive edge in the field. This has led construction and property companies move to proactive information technology operations from reactionary approaches. UK’s Miller Group is one such company that adopted this approach after realising that despite being reactively strong in identifying and subsequently providing solutions to infrastructure-related problems, it had sort of “looking under hood” approach while looking for the root cause of the issues that emerged in the course of company’s problem finding missions. The Miller Group's information technology team was realising that they had problems collating information from different sources in case an issue emerged and needed proactive approach to lead to a solution, monitor it further and prevent through technological knowhow the issue from occurring again. Previously the company monitored in isolation individual hosts by means of different methods but not really in real time. It is noteworthy that the construction industry has seen information technology being used in a widespread manner in different departments in order to be able to pool data related to projects in a coherent, organised manner at the end of the day. Miller Group has been an award-winning company and recognised with RICS South West, Considerate Constructors scheme, Local Authority Building Control (LABC), Celebrating Construction in South Yorkshire, SCALA, and RIBA Northern Network, Housing Excellence, Scottish Home, BCO Office, and NHBC Pride in the Job awards. The group works primarily in four segments i.e., Miller Homes, in which it is tagged as a housebuilder among first eight largest housebuilders, Miller Constructions, in which it operates multi-disciplinary construction activities, Miller Developments, which makes it a major trading and property development company in UK, and Miller Mining, in which it stands as the country's largest coal mining company working in collaboration with Argent Group Plc. As per its 2011 annual report the turnover for each was pegged respectively at GBP271, GBP239, GBP46, and GBP32 millions. The group turnover was GBP588 millions, new equity investment GBP160 millions, and profit before interest GBP20.8 millions. An analysis of the business problem and its environment For effective operations, Miller Group required to collate data from multiple locations and sources for which it needed the services of information technology. To accomplish this virtual or a physical appliance was needed. Some of the previous solutions were looked into but those centered specifically on server sprawl. But that was fraught with increased air and power costs since it was observed that it involved IT staff more on troubleshooting and maintenance of management tools than helping drive in revenues. At the same time since Miller Group's infrastructure is huge and has involvement of innumerable number of vendors and multiple technologies, the new solution that was being looked into was being expected as vendor and technology agnostic which would be able to do away with blind spots created by siloes. Another option that was looked into was having a browser based tool to display all potential solutions but without any client-side software support. In this way Miller Group was trying to capitalise on the study of use of information technology, which is a field of research vying to gain its foothold in this sector. The construction industry has recently been riding the information technology bandwagon for delivering success, and recently studies that have been done in domain have emerged explaining how the amalgamation has led construction companies to reap benefits. In Asia-Pacific region, for example, a number of such studies have been collated. A 1994 study by Valida et al studied around 230 construction and property enterprise, and a year later Yap and Thong (1995) even developed an information technology model meant to be used by small enterprises. Similarly Sohal et al (1998) studied a little more than 500 companies in order to the difference use of information technology mad to construction enterprises. Discussion on the company's approach Miller Group embarked on a rigorous evaluation to find a possible solution of the problem. This even included looking at support that could be taken from Compuware. Finally, in order to narrow down the search, the company first took a trial from a FireScope application. The product seemed to attract the Miller Group tam on a number of counts; two important ones of which were simplicity of the configuration and installation process and quickness of the product to yield a fast payback from the day of its inception into Miller Group's setup. The system had an exceptional cost viability and enabled Miller Group to group several of its technological components and form the critical resource assimilator; something that the company actually wanted to achieve. This enabled the company to get real-time monitoring and alerting system which helped it resolve issues that would otherwise take time to reach out and respond to. Furthermore the system would use effective troublshooting methodology thus reducing resolution times. The identification of the root cause of the issues related to data was made easier by this system which, over a period of time, created a culture of ‘pro-activity’ whenever an issue emerged. The continuous monitoring ultimately led to prevention of wasted time and thus reduce unpredictable expenses. One important outcome on account of its installation was elimination of 'stretched staff' in an attempt to resolve issues. The system is seen as having complimented the Miller Group staff who are considered as exhibiting high levels of commitment and enthusiasm. The 2011 annual report has evidenced this in more ways than one. Known for its build quality, Miller Group customers have vouched for the company's after sale services. The report reveals that 97% of the Miller Group customers have said they would happily recommend their best friends to book a Miller Group home. This customer satisfaction level has led HBF New Home Customer Satisfaction Survey give the company a five star rating. Miller Group's build quality is considered to be enviable. Testimony to this fact is that during the 2011 financial year, as many as 26 Miller Group site managers got recognition through Pride in the Job scheme. In the recent years technology has found increased integration in the construction and property industry and forms the backbone of multiple processes being run in construction enterprises. This also gains further importance on account of the rapid development that has taken place in the last two decades particularly in the three powerful political blocks: Americas, China and Europe. These blocs have determined the trend construction and property activities in these areas; bringing together several large engineering and design companies shaking hands with construction enterprises based in Europe, USA and China. (Appiah-Baiden, 2000; Mavrokefalos, 2000; Murray, 2000). Conclusions Conglomerates have dominated international property and construction industry with annual turnover of over $10 billion. Several programming solutions are available for different professionals associated with the industry ranging from town planners to architects and engineers to data experts (Murray & Lai, 2001). A survey done in Canada among 1000 firms in this industry established use of programs as one of the most integral part of the business processes (Rivard, 2000) and computerisation formed the central core of the activity. Construction industry is no different than any other competitive industry and solution of strategic issues is now widely being handled by use of technology. The technology is being to drive the business faster, collect accurate data through secure modes and transfer from source to source with unpredictable speed. When it comes to resolution of issues these systems form the cornerstone of the processes. Even though some analysts believe that the construction and property sector is still not using these systems optimally and are, even after so much of technological indulgence in other environments, based on what is being termed as 'information islands'. The island concept has emerged on account of the fact that each discipline in a construction and property enterprise has its customised technological tool available for collection of data. For example, discipline like architectural design would work predominantly on the domain-specific software, and when it would need to share information with other disciplines, the process of dissemination may result in dataset incompatibility on account of two different application being used at two different disciplines. These islands of information result in a number of problems like poor data quality, data redundancy, missed opportunities and lost productivity. What the Miller Group, however, did was that it facilitated easy and efficient flow of information from it different locations to the hub where identification of issues was required to be done. This initiative further helped the group develop a system that enabled it to monitor customer reviews which, in a way, was actually intended to gauge its own performance. The further assessment of which would lead the company to strengthen its customer satisfaction initiatives. The group, through its systems, invites each customer to be a part of the reviews that the company runs in series. The feedback thus gathered paves way for making continual improvements in the standards for which the company is known. The system further helps the company assign itself benchmark ratings in UK. Clearly assimilation of data and its transfer by way of communication can be termed as a pipeline in the metaphorical sense that has more than one impact on a business (Axley, 1984). This attains enormous magnitude in construction and property segments as huge data needs to be transferred between several locations. The programs, as the one used by Miller Group, and variety of other applications and software can be seen as important developments in the industry. While the Miller Group addressed only a specific issue that it was encountering, if the allied fields in construction and property industry are looked into, it can be realised that there is a solution for almost every professional in the field. Different solutions are available for surveyors and contractors whose data is important and needs to be pooled for effective functioning of the construction sites. Physical distance between different construction sites gives rise to communication barriers; error-free programs as the one used by the Miller Group augments the problem to a large extent. However, as more and more technologies evolve by the day and many are tried by different construction companies, the love is also thought to be fraught with certain flaws. Cheng (2001) is of the opinion that since large distances is normally encountered as a bottleneck between two different sites in exchange of information, network work as wonders between the two. Cheng adds that both internet and network or latter driven by the former provide exceptional solutions in this regard and can be considered as an effective means of data transfer in activities pertaining to construction and property businesses. The Miler Group used the evolution of technology to its best capability as it realised that it in order to identify, understand, and resolve issues pertaining to its construction activities or customer satisfaction. A large flow of information is created in construction industry and any attempt to either undermine or ignore the same accumulate as issues which, if left unattended, hamper the growth of the enterprise on both long- and short-term basis. References Axley, S. R. (1984). Managerial and organizational communication in terms of the conduit metaphor. Academy of management review, 9(3), pp.428-437. Appiah-Baiden, J.K. (2000). Difficulties facing contractors from developing countries: Problems and solutions. Proceedings of 2nd International Conference of the CIB Task Group 29 (TG29) on Construction in Developing Countries, Gabarone, Botswana, pp 277-286. Cheng, E. W. L., LI, H., Love, P. E. D. and Irani, Z. (2001). Network communication in the construction industry. Corporate communications: an international journal, 6(2), pp.61 - 70. Murray M. & Lai, A. (2001). The management of construction projects using web sites. 2nd Worldwide ECCE Symposium, Espoo, Finland, Symposium Report: Information and Communication Technology (ICT) in the Practice of Building and Civil Engineering, pp 163-168. Murray, M. (2000). New Opportunities in China for South African Construction Professionals. Civil Engineering, South African Institute of Civil Engineers, September Mavrokefalos, D. (2000). Opportunities for consultant from developing countries in the global village. Proceedings of the conference of the CIB Task Group 29 (TG29) on Construction in Developing Countries, Gaborone, Botswana. pp 306-315, 2000 Rivard, H. (2000). "A Survey on the Impact of Information Technology on the Canadian Architecture, Engineering and Construction Industry," Electronic Journal of Information Technology, Vol. 3. Sohal, C., Yap, C. S., and Raman, K. S. (1998). 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