Management at Honam Petrochemical Corporation - Assignment Example

Honam Petrochemical Corporation 9th May, 2015 Prepared by Table of Contents Executive Summary 3 Introduction: individual reflection 4 Question 1: Honam Petrochemicals business strategy 6 Question 2: problems necessitating the new system 6 Question 3: steps in the Systems Development Lifecycle 7 Question 4: change management and Systems Development 8 Question 5: benefits of the new system 9 Bibliography 10 Daft, R., Murphy, J. & Willmott, H., 2014, Organization Theory and Design: International Perspectives, Hampshire: Cengage Learning. 10 Donaldson, L., 2001, The contingency theory of organisations, Thousand Oaks, CA: Sage. 10 Chandler, A.D. Jr, 1962, Strategy and structure: chapters in the history of the industrial enterprise, Cambridge, MA: MIT Press 10 Luhman, J. & Cunliffe, A., 2012, Key Concepts in Organizational Theory, London: Sage. 10 Teece, D., 2007, “Explicating dynamic capabilities: the nature and micro foundations of sustainable enterprise performance”, Strategic management Journal, 28, 1319-1350. 10 The mind map of Honam 11 Executive Summary Honam Petrochemicals, a South Korean based company, plans to roll out operations across other Asian countries. It hopes to duplicate it success in these new markets. However, it recently discovered that managers have been exaggerating figures to give false impressions of high performance in their departments. As a result it has decided to adopt a new information system to provide top executives with current data. It hopes this will address the issue once and for all. The information system department will be undertaking this task. The company will rely on change management to ensure a successful adoption of this new solution. Introduction: individual reflection Working on this project has been an eye-opening experience. It has provided the opportunity to work in a real life team with diverse members. At first it was challenging but the group members managed to get along with one another as time went by. However, it was not as easy as it might seem. The group has had its fair share of challenging times in the course of writing the report. The report had five sections and group members decided to split the tasks amongst themselves. Personally, I think it is what simplified the work. Members simply had to concentrate on their allocated sections. To ensure everyone fulfilled their duties, each member had their work assessed by the other members. Upon delivery, members had to review their colleagues’ tasks and pass recommendations. Members then had to revise their tasks basing on these remarks. This cooperation allowed every member to participate in the writing of each section. We did not want the report to be a compilation of individual tasks. We encountered several challenges in the course of writing this report. At first, it was difficult to find consensus among members on the appropriate time to meet. Sometimes members failed to show up for meetings and cited tight schedules as the main reason for this. However, we had to make compromises and find time to fulfil this task. We formed the habit of meeting late after classes when members had few engagements. Another challenge was difficulties in identifying a leader. No one was willing to take up this task due to its demanding nature. I volunteered to be the group leader. I had to work extra hard to convince members to channel their efforts towards timely completion of the task at hand. The diversity in the group has been a blessing in disguise. The group comprises of members from all walks of life and as a result, experienced varying approaches to the questions. We had a wide pool of ideas that we had to vote on ones which to include in the report. The best thing about the team is that members get along and no clashes occurred. There has been smooth coexistence which I did not expect to happen at first. In fact, members were very supportive of their colleagues whenever they experienced difficulties while researching their sections. I have learnt many lessons in the short duration this group has been in experience. First is that individuals are unique in their own way. There might be stereotypes regarding people’s religion, economic situation, class, gender, and beliefs among other demographic factors but this does not define individuals. I have also learnt the importance of making compromises in life. At first we encountered challenges in meeting and leadership to mention but a few. However, everything started to fall in place after we made compromises. We sneaked the meetings into our tight schedules like most students in other groups had done. Finally, I have to thank all the group members for their invaluable contribution in the writing of this report. Question 1: Honam Petrochemicals business strategy Honam Petrochemical Corporation (HPC) is on a growth and expansion path. As a major player in South Korea, it seems to have attained saturation in this market and is looking for avenues to expand its business. It intends to expand further in the entire Asian market where it already has a considerable presence. In future, it will consolidate its market share in South Korea while striving to acquire new ones overseas. This strategy also bears characteristics of globalization where organizations set out to venture in markets beyond their geographical borders (Chandler, 56, 1962). It has demonstrated that it is concerned with cutting operational costs while simultaneously increasing sales. In this regard, it will be cutting costs in its primary saturated market back home while increasing sales in the new frontiers in the Asian countries. HPC has organized its business into subsidiaries mainly in South Korea whereas partnering with others that are scattered across various countries. This is a signal that HPC has a matrix structure. However, it has in the recent past been shedding off this characteristic. The company now prefers a vertical structure where power is consolidated at the top. This comes in the wake of fraudulent accounting that has been taking place at the departmental level with managers doctoring reports about their performances. Question 2: problems necessitating the new system The new system would address several issues identified in the old one. It would provide the top executives with current data as opposed to those from previous quarters. The system would also simplify the decision making process for executives. By presenting them with only the required data, it would ease the burden of having to peruse loads of data. Furthermore, the system would also guarantee the accuracy of financial reports. There was a trend among the managers of distorting data to show favourable performances for their departments (Daft, Murphy, & Willmott, 9, 2014). This was possible because the executives could only access data at the end of a period by which time the managers would have customized the raw data. However, this system would allow the executives to countercheck the data on a continuous basis. They would have unlimited access to the raw data from personal computers, organizational website, and mobile handsets. As a result, it would be possible to get the accurate evaluations of departmental performances, sales volumes, and incurred costs. The other stakeholders would also not be left. The system would allow the subsidiaries to have remote access to the data from their respective geographical locations. Question 3: steps in the Systems Development Lifecycle The task of developing the system fell on the company's information systems department. This team assessed various options available in the market before settling upon SAP, a software company. HPC runs on this company's ERP system and this largely influenced the decision. The team then went ahead to establish the tools for the selected solution. While at this, it sought the opinion of the top executives to capture all their needs. It is always advisable to engage the users while developing a system as they hold crucial insights on increasing its effectiveness (Donaldson, 23, 2001). The solution would be tasked to provide the top executive with timely and relevant data and reports. Focus then shifted to designing the system. Priority went towards extracting data and generating automatic reports for the users. The team did a remarkable job as the final product was user friendly. With very little training, the executives were ready to start using the system in their daily tasks. In addition to training, the team also briefed the executives all across the organization on the advantages of the system. The team continues to offer support to the executives to ensure they embrace the system. Question 4: change management and Systems Development Change management is mandatory in the process of adopting an information system solution. First, it provides the platform to engage the stakeholders. The developers highlight the need for the solution emphasizing the benefits and how it addresses current inefficiencies. Second, it allows stakeholders to participate in this process. Their contributions could provide new angles in the development and implementation of the solution. Finally, it also increases the chances of success. Change management will involve stakeholders in the process, making it easy for them to embrace the solution one it comes into effect (Luhman & Cunliffe, 34, 2012). HPC followed various steps of change management. It first determined the area of weakness and made proposals on what the future situation should look like. It went ahead to seek contributions from the executives in order to attend to their needs in the impending change process. Furthermore, the information system team trained and continued to support the users during the implementation to ensure they embraced the solution. Finally, there was a systematic introduction of the solution in the organization to reduce chances of interfering with the flow of operations. The system was user friendly in that it had a simple interface where users could access the required information. It also provided each user with relevant data for their position. Furthermore, it is accessible from a wide range of electronics as well as remotely. Question 5: benefits of the new system The new system has provided HPC with several benefits. First, it has done away with the possibility of inaccurate reports. The managers can no longer tailor the data and reports at will because the executives have the option to countercheck with the raw data. In fact, system has automated the task of preparing financial reports which was previously the task of the managers. As a result, the level of transparency has increased. The top executives have accurate analysis of the performances at various departments and can make informed strategic decisions with ease (Teece, 8, 2007). Furthermore, the system complements the company's quest to venture into various foreign markets. Not only has it facilitated easier monitoring of subsidiaries in different geographical locations but also the sharing of data and financial reports. The raw data available to managers has also altered the manner in which executives make decisions. Previously, they had to rely on past data and reports and data. However, they now receive up-to-date date which informs the strategic decisions. Finally, the system has made it possible to make comparisons with other operators in the market. Benchmarking was one of its major features which allows top executive to evaluate the organization’s performance in relation to others in the market. Bibliography Daft, R., Murphy, J. & Willmott, H., 2014, Organization Theory and Design: International Perspectives, Hampshire: Cengage Learning. Donaldson, L., 2001, The contingency theory of organisations, Thousand Oaks, CA: Sage. Chandler, A.D. Jr, 1962, Strategy and structure: chapters in the history of the industrial enterprise, Cambridge, MA: MIT Press Luhman, J. & Cunliffe, A., 2012, Key Concepts in Organizational Theory, London: Sage. Teece, D., 2007, “Explicating dynamic capabilities: the nature and micro foundations of sustainable enterprise performance”, Strategic management Journal, 28, 1319-1350. The mind map of Honam Mind map of report Read More