ISO 9001 Assignment

Product Realization in ISO 9001 : 2008

International Organization for Standardization (ISO) states that product realization includes: Product and service provision; product control and service provision, validating the process of service provision and production, traceability and identification, property of customer, preservation of product; purchasing process, purchasing, information of purchasing. verification of purchasing product; design and development planning, design and development inputs, design and development review, designs and development outputs, design and development verification, verification of development and design, validation of design and development, control of changes in design and development. Planning of product; processes related to customer, determination of requirements and related to the product; control of devices for monitoring and measuring. (Cobbett et al 2005).

ISO 9001 : 2008 requires department to perform the roles in planning product realizations, Recap of ISO 9001 requirements in planning of product realization are planning and developing the process required for product realization and keeping the consistency of the planning, and documentation should be done in an suitable form, i.e. confirming the names of the plant and determine how best to cultivate or procedure or collect the materials of the plant. Determination if the planning is appropriate i.e. determining the key physio-chemical features of the material and establish the parameters. Here we need product requirement and quality objectives, need for document, process and resources. Validation, verification measurements monitoring, test activities and inspection i.e. establish and determine a good dosage from based on the findings that are confirmed and the legal requirement of the customers for the prospective products, procedure for the product acceptance. Record are required as evidence that the resulting product And the process meet the requirements. The industry pharmaceuticals would establish after determining a suitable dosage form based on confirmed findings and legal customer requirements for the prospective products then registration dossier to be finalized by PTRMD with other departments assistance majorly MCQC.

ISO 9001 Process

As per ISO 9001 : 2008 department role in customer related process there are three QMS processes or requirements under sub close 7.2. It should entail. 1).the requirement connected to the product: customer requirement should be determined, like if it is decided that given medicine should be powder, tablet or capsule others will feature in the a head task, regulatory and statutory requirements needed to the product, not specified for given product though needed for intended or specified use that is known and any requirement that is considered necessary should be given. 2) The industry pharmaceuticals should review the requirement above, the product requirement should be reviewed before supplying the product to the targeted customers for the purpose of ensuring the exact definition of the product requirement, maintaining any subsequent follow up action and the review result, ensuring its ability of meeting the requirements, when the given requirements have not been documented, before any acceptance they must be confirmed, if there is any change in the requirements of the product, ensure amendment of the relevant documents and the personnel who are relevant, are informed of the requirements changes. In situation like, if the report from TL to the CEO gives support for further action on given procedure the CEO will give direction for the TL to proceed with customer-related processes as per sub-clause 7.2. (3) customer communication; the department should be a well implemented and determined for communication with the customers on inquiries, information of the product, handling of the order plus the amendments, feedback of the customer plus the complains made by the customers. (ISO 9001). For instance the team may or may not be reconstituted but the new incoming directions of the given medical research may call for a wide range of expertise from the various units or may be from outside of the team. 4) customer communication is determining and implementing proper ways of communicating with the customers for the purpose of product information, contracts, inquiries or handling of orders including amendments, feedback of the customer plus the complains of the customer.

Role of industry pharmacy department in development and design process as per ISO 9001 : 2008.Recap of ISO 9001 requirements in respect of development and design processes. The roles are: 1) Design and development planning, the team should plan and have control of the design of the product and development for determination of the; stages of development and design consist of verification, appropriate view, and the validation activities for every given stage. The industry pharmacy should produce the highest customer friendly and legal acceptable form of dosage, authority and responsibility for the development and the design, managing the interfaces between the groups that are involved for ensuring effective and clear responsibility assignment, update as appropriate the output planning during the development and the design, the development and design may involve any unit or department depending with the situation. 2) Design and the development input; designing the requirement of the product maintain record and the inputs. The industry pharmacy would strive to provide animal facilities and come up with the most appropriate study model. Applicable legal requirements, and the applicable information derived from the same design, essential requirements for the development and design, review of the input for adequacy, resolving of ambiguous, incomplete or requirements that conflict. The industry pharmacy should strive in providing the highly efficient and economic procedure for the raw materials qualification and the finished product. 3) design and the development output; the output of the design and the development should be documented in a way that they are suitable for verification against the input to the process, and the output should; provide purchasing information service and products, meet the requirements of the design and development, reference or contain the criteria of product acceptance, define the essential characteristics for proper and safe use, the products should be approved before their release, like the industry pharmacy would study design for trials in clinical rest with the CEO office who may utilize expertise from in or outside.

Industry pharmacy role in the development design and processes as per ISO 9001 : 2008. There are 7 QMS processes or requirements under 7.3 (Magaji et al 2012). should be within; development and design review, where the team should perform systematic design review and development at the appropriate stages in accordance with the arrangements that was planned in evaluating the ability of the given results, to requirements as the design review and development are important in discovering the efficient and economic procedures within the industry pharmacy department concerned with the development and design, identifying problems and stating the necessary actions, the result of the reviews should be maintained and do follow up actions subsequently . 2) Development and design verification in accordance with the planned arrangements, the team should conduct verification for ensuring the input requirements are met by the output, and put in maintenance. The result of the verification and continuous follow-ups, for instance the industry pharmacy should give most efficient and economic procedures for qualifying the given raw materials and the end product. 3) Control of design and development changes; identifying changes of the design and development and maintaining the records, verify, validate and review the given changes and make appropriate approval before they are implemented, i.e. when the given products or services fail to pick up as it was planned they have to be re-designed. Evaluating the changes in form of their effects on constituent parts and products already delivered, put in records of the changes result and continuous follow up actions.

Industry pharmacy role in purchasing processes as per ISO 9001 : 2008 which is associated with: 1) purchasing process, the industry pharmacy should ensure that purchased products fulfill their its specified purchase needs in consideration of the type of the products on subsequent process of realization or final product (Magaji et al 2012) i.e. even if there is central purchasing unit supplier department and administration responsible with special and general purchases the criteria for the latter in product realization are furnished by industry pharmacy. Select and evaluate suppliers upon their ability to make supply in accordance with the requirements, establish the procedure of selection (Pharmaceutical, Inc.), re-evaluation and evaluation, and Keep the result of evaluation and subsequent follow up actions. Like the industry pharmacy should provide or source the procedure for the purchase starting materials plus other goods and reagents. 2) Purchasing information requirements to ensure that information of purchase contains the information describing the product to be purchased plus the requirements. Product approval processes, equipment and procedure.

Ensure the quality of being sufficient of the given requirements before making communications to the supplier, and the various department or units should be responsible in verifying purchased items supplied to them. 3) Verification of purchase product is to implement and establish the inspections or other necessary activities for confirming that the products purchased meet the indicated requirement of purchase i.e. Units or departments are responsible for verification of items purchased to them. Should be responsible if the customers or the organization proposes for product verification at the location of supplier they should give the intended verification arrangement and the method of releasing the product in the information for purchase.

Recap of ISO 9001 requirements, there are 5 QMS requirements and processes under sub-clause 7.5 (Megaji et al) the processes are: 1) control of service provision and production. Services provision should be planned and control should be carried out in controlled condition to be applicable. In industry pharmacy every department can provide different data such as taxonomic data and the department can provide highly specialized services as chemical synthesis and forensic analysis, efficacy or toxicity data or data of comparative effect of non-economic or economic species or the antimicrobial potential of a given herb. The information of given product characteristic should be available. Necessary instruction for work should be available i.e. the department responsible should put into writing dossier for registering and regulatory agency of medicine. Suitable equipment should be used. Measuring and monitoring equipment should be available. Monitoring and measuring activities should be implemented. Implementation of delivery, product release and activities of post-delivery. 2) Validation of process for service provision and production, it entail validating service provision or any production in which continuous measurement or monitoring may not verify the given output. This validation consist of processes in which deficiencies may turn out apparent only after service delivery or product use. Through validation, it demonstrates the ability of the process to achieve the planned outcomes. Arrangement of validation should be established including applicable; equipment approval personal qualification, records requirements approval and process review criteria, using defined procedure and methods and re-validation i.e. where herbal medicines and pharmaceuticals needs to pass a battery of test like disintegration test (Capsules and tablets) and before being approved identification.

ISO 9001
ISO 9001

Industry pharmacy roles in production and service provision as per ISO 9001 : 2008. The recap of ISO requirements there are 5 QMS requirement process under sub-clause 7.5 (Megaji et al 2012), in respect of service provision and production process are: 1) identification and traceability; where appropriate identify the product using best means during the product realization, the key role of the department should be to help establish or propose probable route of production to be done on pilot scale since in chemical medicine production, several in-process quality procedures control are needed.

The department should identify the status of the product with respect measurement and monitoring requirements throughout the product realization it requires that the industry pharmacy should be able to make identification of the product by using appropriate means throughout product realization. Traceability requires that, maintain records and have control of product unique identification as this process is important for regulatory processes and product realization. This are essential strategies that will help in tracing a given problem to their various sources hence every department must take great care with property of customer which are under their control.

2) Customer property; the industry pharmacy should exercise care with any property of the customer while it is still being used or under the control of the department, customer property should be verified, identified, safeguarded and be protected. Any damaged, lost, or unsuitable customer property should be recorded and be reported, this an essential approach for addressing regulatory concerns and accountability concerns which are associated with given pharmacologic agents like poisons and narcotics.

Product preservation should be done during the internal processes and delivery to the required destination for the purpose of maintaining the requirements conformity since applicable preservation consist of handling, identification, packaging, storage and protection i.e. product status should be identified with respect to measurements and monitoring requirements, the departments are required to have defined reference active crude extract, market substance which is defined.

Industry pharmacy department’s role in control of the measuring and monitoring equipment as per ISO: 2008 recap of ISO 9001 requirements, some of the equipment’s in need of re-calibration and calibration are: volumetric wires, refractometers, gravimetric instruments, photometers, electronic devices and various electronic equipment’s.

Summary

The recap of ISO 9001 requirements in respect of monitoring and measuring equipment’s processes include. 1) Control of monitoring and measuring equipment’s the department is to determine the measurement and monitoring to be made and the needed equipment for production of product conformity evidence. like the practise of standard’s needs, all units and departments to do calibration to their equipment’s as it is described by procedures for operating and in performing this other control measure needed assessing and recording prior result validity if the method or equipment are observed to conform to the requirements, verification and calibration result records should be maintained, re-confirm or confirm the ability of any software or the used programmes for measurements or monitoring before its initial usage.

2) Control and use measuring and monitoring devices for ensuring that capability of the measurements is consistent with measurements and monitoring requirements, and ensure for the validity of the result in situations where it is necessary; the equipment’s should be calibrated to international or national standards, verify or calibrate the equipment’s for measuring prior to use or at specified intervals, the equipment’s should be safeguarded from improper adjustments, they should be re-adjusted or adjusted as necessary, they should be protected from deterioration and damages.

3) The validity of prior results should be assessed and recorded to find if the device conforms to requirements, in ensuring the result validity the department would; verify or calibrate the measuring equipment’s at prior to use or at specific intervals, equipment’s to be safeguarded from improper adjustments and damages, do the necessary adjustments and re-adjustments, record the equipment’s appropriate basis and do the identification of the equipment’s for measurements for determining their calibration status. 4) Conforming the software used ability for measuring and monitoring for the application that is intended before its initial use.

In conclusion accompany that certifies the level of ISO 9001 : 2008 has got numerous advantages compared to the others, since the companies outsourcing sponsors and customers will also benefit from this .It will help the company to assure their customers that they will meet their needs for product development, product design, servicing, installation and product developments beside meeting the needs of cGMP requirements. (Pharmaceutical, Inc.) And compliance to ISO standards is normally voluntarily though many pharmaceutical companies view it to be hard because of the added level of quality system oversight that that FDA current good manufacturing practises.

References

Quality and Compliance – Pharmaceuticals, Inc.

ISO Survey 2009 (cited 2014 November 11)

Corbett CJ, Montes-Sancho M J, Kirsch DA (2005). The Financial Impact of ISO 9000 certification in The United States. An Empirical Analysis. Management Science 2005.

Grba Magaji, et al (2012). Production realization and Service Provision in Herbal Drug Research and Development According to ISO 9001. Journal of Pharmaceutical and Scientific Innovation.

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Effective Team and Performance Management

Effective Team and Performance Management

This article is intended to evaluate the case study on Electron Corporation and highlights main key points pertaining to team building as well as enhancing the effectiveness of team productivity, established team environment and performance. Building of teams and effectiveness of team performance can be derived from various primary attributes (Zaccaro & Klimoski, in press). Teams are firstly needed to successfully contribute their individual efforts because their certain needs and responsibilities will form the basis of the collective success of the team. Secondly, since teams need to operate in complicated and ever changing organizational environments, they need to tackle multiple organizational team characteristics such as conflicting agendas, load of greater information, swift changes in the situations as well as enhanced dynamic changes (Zaccaro, Rittman & Marks 2001).

A small overview of the company includes; Electron is a small manufacturing organization established in 1997 in North of England. It manufactures components for telecommunication division. It employs 150 people along with 90 people in the manufacturing division. It was originally a department of a huge telecommunication organization and the Electron’s team bought the component manufacturing section as a portion of an outsourcing plan presented by the parent company in 2007. Electron has acquired both full time and part-time employees. In 1990s, its management realized that the company was striving for increasing competition and innovation in the industry. So in order to enhance their competition in the market, they have found the need of a more proficient and effective production procedures while emphasizing on enhancing organization’s culture, customer services, improved performance and responsibility and loyalty towards teamwork.

However, the subsequent sections of the assignment involve literature review which will cover the benefits and dysfunctions of teamwork. The Tuckman’s (1965) model of team building is also been employed in relation to the case study which demonstrates how teams must be efficiently formed. Whereas, the last sections will demonstrate the conclusion of the study as well recommendations on how to enhance the team performance more effectively and the steps that need to be taken for creating a subtle team environment.

Literature Review

The use of teams seems to provide several advantages; they may not be the most appropriate tactic for all types of organizations and not all of the organizations face similar and all challenges imposed by the teams. The influence of teamwork (both optimistic and pessimistic) is dependent upon several features such as company’s culture and environment, efficiency of team leadership, company’s efforts etc. Primarily, a team can be described as a small group of people along with a set of performance objectives, who are responsible to a common goal and the attitude they carry themselves mutually responsible (Katzenbach & Smith 1993). This definition explains that organizational teams should be of a manageable size and all of the team members should be accountable to achieve the shared team objectives. Moreover, all of the team members should be mutually responsible towards their activities and the results of those activities.

The Enticement of Working with Teams

The power of team work roots from several factors particularly when teams are employed. Various researchers demonstrated that teams are increasingly being employed as a response to ever increasingly global marketing competition (Heap 1996; Roufaiel & Meissner 1995; Sundstrom, De Meuse & Futrell 1990). Because of this increase in competition, it is also viewed that catering niche markets is also a growing concern. Since, electron emphasizes on enhancing organization’s culture, customer services and improved productivity; as a result, Electron manufacturers not only need to compete on cost but also strive to compete on innovation by establishing distinctive goods and services that could not be countered by the other rivals in the market. However, this will originate a problem where the company is not supposed to rely on mass production as well as economies of scale in the industry.

Most organizations still believe that working with teams is the only answer to this problem (just as Electron did). In their view teams are the source to optimize company’s innovation as employees have increased self-sufficiency, increased involvement and autonomy for making decisions (Harvey, Millet & Smith 1998). The employees no longer need to be guided about what is required to be done. In fact, they are provided with the objectives or develop objectives along with their team leader and then give autonomy to choose the best way in order to accomplish those objectives. Additionally, organizational innovation can also be optimized if teams are able to provide other enticements to the organization the situation in which they operate.

For instance, firstly, teams can optimally utilize human resources since they permit companies to achieve access to a person’s knowledge and capabilities (IRS Employment Review 1995). Albeit, the enhanced intricacy of the companies means that not all the managers know everything regarding each and every facet of the company’s operations. In this circumstance, it is important to utilize knowledge and capabilities of the employees/teams. Secondly, teams can be utilized to optimize company’s learning as employees are capable to design best strategies being suited to their work objectives (Wageman 1997). Thirdly, Teams are also capable to enhance individual’s performance levels and his/her efficiency, thereby establishing a synergy (Katzenbach & Smith 1993). Finally, team work is greatly associated with various numbers of objectives, tasks and additional accountability for each member of the team, which in turn resulted in enhanced job satisfaction, employee motivation and more work commitment. This will also result in lower employee turnover and absenteeism, thus, decreasing company’s costs and enhancing company’s knowledge base (Kirkman & Shapiro 1997).

Dysfunctions or Challenges Accompanied Teamwork

The employment of teams is primarily a change to an organization as well as a developmental procedure. Thus, teams can be easily affected to any challenge that might emerge during an organizational change. Particularly, resistance among employees may occur when they are needed to work along with other employees who are unfamiliar to them. In this way, teams are more likely to have broken established social relationships. This has already done in the Electron when huge number of new employees was hired and was integrated into one of the Electron’s teams. Those workers were new to their team’s values and consensus where they exerted greater challenge to the already existed relationships among the older employees.

In accordance to Bettenhausen (1991), one way to cope this problem is by forming teams. Building of teams will enhance group productivity by enhancing communication, minimizing conflicts and establishing greater bonds and commitment among all the working team members. Resistance among employee can also occur as a result of other factors. For instance, teamwork may need job enlargement where each team member is required to perform his/her conventional role along with his/her team role (IRS Employment Review 1995). In this circumstance, it is essential to minimize their certain responsibilities or to change the structure of their rewards or compensation.

Besides job enlargement, team work is also coherent with autonomy, ownership and additional commitments. Managers frequently perceive that employees must participate in decision making instead of simply being directed of what needs to be done. However, this might be true for certain situations but not for all situations. This will, in turn, may resulted in employee job dissatisfaction, increased employee turnover and/or reduced work productivity. The similar case is also viewed in Electron, when it hired new employees on temporary basis and let the managers to decide who must be hired on as full-time employee. Those workers initially were also unfamiliar with the team procedures and were expected by the managers to know the team’s values and conform and act accordingly to their team’s norms. Teams at Electron started exerting their concertive control over the new individuals which as a result new employees began controlling themselves and those norms and values become rationalized rules for the new members. There is no simple solution for catering such problem; however, training or changing positions can be probable within the company.

Other associated problems with “empowered teams” originate when there is a lack of trust in the team when they are no longer trusted enough to participate in decision making. This will result in teams and organizations losing full potential to accomplish their desired objectives. The situations in which teams are needed to seek consent before executing any idea or timeliness, ownership is likely to reduce. Organizational innovation will also decrease as teams are compelled to suggest ideas that will be likely to accept (Nahavandi & Aranda 1994). Moreover, team members may also perceive that their management is paying insincere respect to their proposed ideas of teamwork which will certainly result in reduced employee morale.

It is also viewed that when teams are involved in making decisions, they take more time than the system they reinstate. This is also needed where team coordination is required and where team members are independent. This issue can be partly cope by the formation of the team, but this also requires continuous training and development of groups teams. Such kind of training can be specifically appropriate for the new hired staff as there may be no established procedures for them to follow. Also, for effective teams, there must be strong coordination among them (Harvey, Millet & Smith 1998). Similarly, the lack of participation in decision making and coordination among employees for building of more strengthened team culture is seen in Electron’s eight teams (red, blue, white, green, silver, aqua, purple and yellow). This is due the fact that the older and long tenured employees have tried to impose strict concertive rules and procedures to conform to the group norms.

In case of organizational environmental changes and developmental initiatives, culture of the organization and environment must also be considered. It must not be perceived that the objectives and values of the individuals are similar to those of their management or congruent even across the entire organization. The attitude of individuals towards teams will demonstrate the success of those teams. If teams need to be executed more successfully, the extension of already existed values must be there (Carr 1992). Therefore, Electron when working with teams also demand shift in attitudes that a company may turn to it when it wants to accomplish a cultural shift, for instance, when it becomes more quality or customer oriented (IRS Employment Review 1995).

Five Team Development Phases as Proposed by Bruce Tuckman

This model as proposed by Bruce Tuckman (1965) tends to highlight and guides the areas where teams can be successful and/or become failure to achieve desired team goals. For forty years, Tuckman’s classical model of team development delivers ease and new perceptions to managers to either charge to run a team or attempt to function within a team while assuring each member that they are not alone and that the uneasiness is a normal part of the team journey towards an efficient and pleasant unit. Tuckman speculates that these stages are essential and unavoidable. In order for the Electron teams to grow, to face the hurdles, to cope up with the problems, to search for solutions, to organize work and to deliver desired outcomes; these five phases can be elaborated as follows.

Phase One: Forming

In this first phase of team building, Electron teams must be formed. Where the attitude of the individual is driven by the desires which are likely to be accepted by the other individuals and prevent any controversy or conflict. Solemn problems and attitudes are prevented and people are required to concentrate on their busy work routines. Individual members also try to gather knowledge regarding each other, regarding the scope of the task and how to reach it. This phase is considered to be an easy stage but prevention of controversies and conflicts mean that not much objective is actually accomplished. The teams will together meet and learn about various opportunities and confront and then agree on objectives and start to tackle the tasks and objectives. Members of the team will quite behave autonomously.

Each team member must concentrate on his/her team leader by accepting the leader’s guidance and authority while maintaining a respectful distant association with other individuals. At this phase, the leader must open two way communications and be ready to reply any of the queries that may come on his/her way; limitations, potency and vulnerabilities must also be tested including those related to the leader.

Phase Two: Storming

Each Electron group then will enter into the next stage where different ideas for competition are considered. The teams address distinct issues such as what kind of problems they need to solve, how they must function autonomously as well as mutually with each other and which leadership model they must accept to follow. Each team member will have the privilege to confront others’ ideas and perceptions. In most cases storming is solved more quickly while in others, most of the teams never leave this phase (this depends on the maturity of the team). Most team members concentrate on the ins and outs to dodge the problems. This second phase is essential for the teams to grow which could be controversial, distasteful and often excruciating to the team members who are opposed to the conflicts. Tolerance of each team member must also be emphasized because without patience, teams will likely to fail.

This stage can be proved destructive for the teams if they are permitted to go out of control. Managers/supervisors of the teams might be more accessible but need to be directive in their professional and decision making attitudes. The teams therefore, will solve the problems and differences and contribute more comfortably with one another. In this way, they cannot be judged and can share their stand points and ideas easily with each other.

Phase Three: Norming

At this phase of team building, Electron managers will set one objective and one mutual plan for the team to accomplish. Some of the members will be motivated to give up their certain ideas in order for the team to effectively function. At this phase, each team member feels his/her commitment to the team and has the aspiration to work towards the success of the team’s objectives.

Phase Four: Performing

It is probable for certain teams to reach to this stage. The high performing teams can be able to work as one unit as they able to identify best approaches to get their job done mutually, comfortably and without irrelevant controversy or the requirement of any external management because they become motivated and knowledgeable by this stage. When the members of the Electron teams are now skilled, independent and experienced, they can tackle the process of decision making without the burden of any supervision (however, supervisors are also directive and participative at this stage but team make more appropriate decisions). The Electron teams must pass through this stage several times because of the global and organizational dynamic changes.

Phase Five: Adjourning (and Transforming)

This stage involves un-forming the groups which sometimes create a sense of loss often feel by the team members. This stage will include ‘dissolution’ which leads to the end of the Electron team members’ roles and responsibilities, the accomplishment of objectives and minimization of reliance. This procedure can be traumatic specifically when the dissolution is not planned. Thus, team members must be acknowledged at this phase that at the successful achievement of the productivity levels and outcomes, teams will be dissolved and that new teams will emerge for new targets.

Conclusion

In order to execute and sustain teams to operate effectively within the organization, sufficient organizational changes are required to be considered as well as various issues required to be catered. Those changes not only influence team members but also the responsibilities and commitments of the supervisors and managers, the organizational framework, work procedures and techniques and employees’ social bonds. That’s why due to the dynamic environmental changes, Electron manufacturers also face multiple challenges which occur as a result of teams’ implementation. However, it is also evident that in case of teams’ implementation, various organizations will not opt for going back to their prior organizational frameworks (IRS Employment Review 1995). Consequently, it is also seen that teams, in spite of the emerging challenges, are capable enough to offer several advantages to firms in the long run.

In case of Electron manufacturers, new hired team members were unknown of the team’s values, norms and consensus that proved greater challenge to the already existed relationships among the older employees. Moreover, managers were also expecting that each new member must be familiar with the procedures and norms of the groups to act accordingly and conform themselves to those groups. However, besides the implementation of their concertive procedures and motivating employees (by providing them rewards), Electron teams still lacking certain key aspects which formed the basis of a strengthened team. Such as two way communication, participation of employees in decision making, lack of trust among team members, sharing of opinions and ideas among each other to resolve any critical issue regarding production and enhancement of work performances and employees’ morale.

Thus, as a result of this, Bruce Tuckman’s (1965) model of team building is employed in the context of Electron manufacturers. According to his model, teams are to be developed step by step by ensuring performance effectiveness in each team building phase. This model consists of five stages i.e. forming, storming, norming, performing and adjourning. This can be concluded as Electron must forge its eight teams in a manner such that each individual must know his/her accountability, change his/her attitude according to the organizational culture so that teams will effectively function with minimum conflicts and controversies (forming). Second, teams must be encouraged to share their wide scope ideas and opinions and can confront the other’s ideas for making better decisions and improved productivity (storming).

Third, Electron managers must establish one objective and direct the team to mutually accomplish the objective which enhances the members’ sense of responsibility towards the team success (norming). Forth, when Electron’s team members become more experienced and capable enough, they will be able to make decisions without any supervisor which in turn, gives employees more autonomy, understanding of each other’s roles, increase employee social relationships, enhance their morale as well as enhance work productivity (performing). Finally, when the production target is successfully achieved, teams will be terminated at the final stage so that new teams will be developed to achieve new production targets with the passage of time and make the organization subtle to dynamic industrial changes with the help of new teams’ formation.

Recommendations

Following are some of the recommendations that can be further considered for making organizational teams more strengthened and intensified.

  • In accordance to Tuckman’s strength deployment inventory (SDI) model, employees must be nurtured with the help of managers without directing rewards in return. They must be motivated to enhance their self-worth by accomplishing tasks and other significant orders.
  • Fulk, Bell & Bodie (2011) also employed Tuckman’s five stages of team development to enhance team performance. According to them, the first stage ‘forming’ must also involve hiring and selecting right individuals at the right time who also possess the qualities of solving critical problems, controversies, communication gaps, decision making, setting of plans and goals and organizing tasks within teams.
  • At the second stage ‘storming’, managers must anticipate to unexpected events that are likely to lead the whole team to the conflicts which are likely to arise as a result of differences in opinions, styles of working and priorities. The managers must be vigilant to take all those conflicts into consideration and encourage teams to take appropriate and productive actions towards mitigating those conflicts.
  • The third stage ‘norming’ must involve working with teams with specific as well challenging goals and those goals must be present in writing. Here team performance can be enhanced if teams revisit their initial goals, clarification of the goals and the commitments towards those goals.
  • At the fourth stage ‘performing’, managers must monitor their teams ‘objectives and their feedback on a regular basis in order to enhance teamwork. That feedback must be timely basis as well as concrete to be acted upon.
  • At the final stage ‘adjourning’ the team members instead of felling a sense of loss, team members must be expected to enjoy their success resulted in successful completion of the task.

Bibliography

Bettenhausen, K.L. (1991) ‘Five Years of Group Research: What Have We Learned and What Needs to be Addressed’, Journal of Management, vol. 17, no. 2, pp. 345-381.

Carr, C. (1992) ‘Planning Priorities for Empowered Teams’, Journal of Business Strategy, vol. 13, no. 5, p. 43-47.

Fulk, H.K. (2011) Team Management by Objectives: Enhancing Developing Teams’ Performance. Journal of Management Policy and Practice, 12(3), 17-26.

Heap, N. (1996) ‘Building the Organisational Team’, Industrial and Commercial Training, vol. 28, no. 3, pp.3-7.

IRS Employment Review (1995) ‘Key Issues in Effective Teamworking’, no. 592, pp. 5-16.

Katzenbach, J.R. & Smith, D.K. 1993, The Wisdom of Teams, McKinsey & Company, New York.

Kirkman, B.L. & Shapiro, D.L. (1997) ‘The Impact of Cultural Values on Employee Resistance to Teams: Toward a Model of Globalised Self-Managing Work Team Effectiveness’, Academy of Management Review, vol. 22, no. 3, pp. 730-757.

Nahavandi, A. & Aranda, E. (1994) ‘Restructuring Teams for the Re-engineering Organization’, Academy of Management Executive, vol. 8. no. 4, pp. 58-68.

Performance Coaching Training (2010) Bruce Tuckman’s Forming, Storming, Norming & Performing Team Development Model.

Roufaiel, N.S. & Meissner, M. (1995) ‘Self-Managing Teams: A Pipeline to Quality and Technology Management, Benchmarking for Quality, vol. 2, no. 1, pp. 21-37.

Sundstrom, E., De Meuse, K.P. & Futrell, D. (1990) ‘Work Teams: Applications and Effectiveness’, American Psychologist, vol. 45, no. 2, pp. 120-133.

Teambuilding Solutions (2011) Strength Deployment Inventory (SDI).

Wageman, R. (1997) ‘Critical Success Factors for Creating Superb Self-managing Teams, Organisational Dynamics, vol. 26, no. 1, pp. 49-60.

Zaccaro, S. J, Rittman, A.L & Marks, M.A (2001) Team Leadership. The Leadership Quarterly, 12, 451-483.

Appendix A

Performance Management
Performance Management
Effective Team
Effective Team

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Business Strategy

Business Strategy King Digital Entertainment Company

King Digital Entertainment is the company that developed Candy Crush, which is a globally popular mobile game (Wilhelm). The company has registered rapid growth in the past few years, particularly during the years between 2011 and 2014; the company’s revenue generation grew from USD 63.9 million in 2011 to USD 1.88 billion in 2013. During the same period, the company’s active user count increased from 30 million to 408 million, as of the last quarter of 2013 (Wilhelm). About three-quarters of the revenues of the company accrue from the mobile channel, which demonstrates the centrality of the mobile channel to the company’s business strategy (Chapman). The company employed a very unique strategy in the already saturated games market; it developed and concentrated on a handful of games, which were well received in the market (NBC News). The positive reception and popularity of the games can be attributed to the company’s competitive pricing of its products.

Business Level Generic Strategies

The main business level generic strategies used by King Digital Entertainment include cultivating more competitive advantage over competing companies, through maximizing the value offered to its customers (Kozami). The company does this through increasing the benefits enjoyed by their customers and also offering more service areas, which justify their pricing. In this area, the actions of the company include the development of games with a solidly social nature, the use of cross-platform technology infrastructure during the development process, the utilization of viral channels, and offering highly effective social features. Relevant to this generic business strategy, there is also game longevity and the cross-promotion of new games to the audience, which offers higher value to gaming customers.

The second business level generic strategy used by the company is that of differentiation, where the company has maintained the leadership position in the offering of games with distinctive qualities, which are customer-driven (Kozami). Towards putting this strategy into action, the company maintains a massive layer network, which informs product development and product purchases. The strategy is also informed by the fact that the company spreads the news about the social features of their products through viral channels, which ensure a wide scope of coverage. Additionally, the wide-reaching time-based campaigns help the company to develop products that are reflective of the needs of their customers, which also improves the experience of the customer.

The ways in which functional level strategies support generic strategies

Functional level strategies are the approaches used by the functional centers of a company, towards the realization of business and corporate unit objectives and strategies, through the maximization of productivity and the utilization of resources (Kozami). These strategies support generic strategies by streamlining the resources of a company and its productive capacity towards the generic strategies. For example, towards increasing differentiation, the resources and the productive capacity of the company is channeled towards research into new game designs and incorporating the changing needs of customers (Wilhelm).

Identification and discussion of business-level growth strategies

The business-level growth strategies of the company revolve around the exploitation of the differences of the target customers from the industry-wide balance (Kozami). The company realizes this through isolating a specific buyer classification, isolating their segment, and concentrating on the group to find its niche. In the real world case of King Digital entertainment, it has included diversifying into the mobile game portfolio and broadening the game portfolio through capitalizing on the mobile channel, which yielded 75 percent of the company’s revenues (Wilhelm).

Business Strategy Dissertations
Business Strategy Dissertations

The mission statement of the company revolves around the provision of highly engaging content to the different customer groups, in a way that matches their mobile needs at any time, place and on different devices. This mission statement is encapsulated in the growth strategy of the company, which revolves around increasing app-usage during different times and customer groups (Wilhelm).

The strategic plan of King Digital entertainment revolves around capitalizing on successful brands to foster the growth of newer ones, which increases the uptake of the company’s products within the market (Chapman).

SWOT Analysis

Strengths

  • Capacity to change strategy; for example, the capitalization on the three leading titles: Candy crush saga, farm heroes saga, and Pet rescue saga to grow other game brands.
  • Focus on research and development, incorporating discrete campaigns.
  • The popularity of their games, particularly Candy crush saga.

Weaknesses

  • Dependence on the success of the current game brands to foster growth
  • A streamlined niche market: more than 75% of revenues came from the mobile channel
  • Stagnant global sales

Opportunities

  • Developments in mobile gaming
  • Increased uptake of online and mobile gaming
  • Changing customer needs

Threats

  • Issues related to consoles
  • Increases in software copying and piracy
  • Strategic game release dates, to avoid the slowdowns of holidays among other events (Wilhelm).

References

Chapman, Llizette. IPO-Minded Gaming Co. Kabam Buys Phoenix Age; Largest Buy Yet. Business Strategy – The Wall Street Journal. 10 Mar. 2014. Web. 17 Mar. 2014.

Kozami, Azhar. Business Policy and Business Strategy Management. Second Edition. New Dellhi: Tata Mc-Graw-hill Publishing Company, 2006.

Wilhelm, Alex. Inside The IPO of Candy Crush Maker King Digital. Business Strategy Techcrunch, 13 Mar. 2014. Web. 17 Mar. 2014.

NBC News. Candy Crush Game Maker Aims to Hit $7.6 Billion IPO Sweet Spot. 2014. Web. Business Strategy Snapshot. 18 Mar. 2014.

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Sainsburys Operations Management

Sainsbury’s Operations Management

The major role of operations management is to make use of company strategies by ensuring that they are put into action, through various ways (Misra, 2008, p. 895. Sainsbury’s is one of the leading global retailers, competing with regional heavyweights such as Tesco, among others. The company was started in 1869, and right now it has about 1,200 supermarkets and stores around the globe, it has about 161,000 employees, better called colleagues (J-Sainsbury’s, 2014). Sainsbury’s has a team of managers, who are responsible for the implementation of important company strategies on a daily basis. Figure 1 below shows Sainsbury’s financial position in 2014.

Amount £357Million 14.5% 16.7% £12.7 billion 24 million 161,000
Description Underlying half year pre-tax profit Underlying half year basic earnings share The market share Group Sales (Half Year) Weekly customer transactions Employees (Colleagues)

Operational Context

At the helm of the operations board is the Chief Executive (Mike Coupe), then the following heads: John Rodgers (Chief Financial Officer); Helen Buck (Business Development Officer); Rodger Burnley (Retail and Operations Officer); Tim Fallowfield (Company Secretary and Corporate Services Director) and Peter Griffiths (CEO Sainsbury’s Bank), among others (J-Sainsbury’s, 2014). Most of the operations led by various managers in the company are aimed at enhancing the company’s position in the market, and making it more appealing to its clientele in the end. For instance, the retail company works on an ecosystem-related operations management plan, which aims at enhancing the conservation of fisheries (Sainsbury, Punt & Smith, 2000, p. 731). The company uses the Management-Strategy-Evaluation design as a way of focusing on all the important details that enhance effective operations management (Sainsbury, Punt & Smith, 2000, p. 731). Figure 2 below shows the operational data in terms of environmental conservation, even as the company continues to expand.

Description Annual Carbon emission reduction Electricity supply from green power Stores with natural refrigerant Solar Panel installed
Amount -2.4% 13.5% 166 107,396

External Influences

There are many factors affecting the performance of any business, such as Sainsbury’s, and most of them are external. One such factor is the availability of strong competitors such as Tesco. Market entrants also divide the market share, as they come up with brilliant strategies to win their customers. Just as it is for other competitors in the market, it is the aim of every operations manager to ensure that the major objective of each activity is high consumer satisfaction (Parker, 2012, p.45). Economic stability of different nations is yet another factor influencing the decisions of Sainsbury’s, especially in terms of expansion. Economic meltdowns, for instance, affect customers’ purchasing power, and this also applies to political instability. The power of the customers due to the availability of competitors and substitute goods also influence Sainsbury’s prices. This is the case too where the suppliers have an increased power, as a result of supplier collusion, among other factors.

The role and importance of effective operations management

Supporting the Company’s Strategies

That operations management is an essential part of a business is a fact, and this manifests itself in a number of ways. For instance, it is the role of the process of operations management to support strategies that are developed by the board of directors (Pycraft, 2000, p.43). In this approach, it is the work of the operations management to come up with the essential resources that are going to make it possible for company strategies to be realized at the end of every operation (Pycraft, 2000, p.43). It is the work of the operations management to come up with ways that will ensure the most sustainable production processes, which ensure maximum cost-cutting for the company, as much as the strategies would allow.

Operations Management Dissertation
Operations Management Dissertation

Product Positioning

It is the work of the operations management to ensure that the final product stand out in the market, as a better option among many. One thing for instance, is ensuring that the product is made through green processes, and that it is of high value, such as the fish. This positioning of products will come in the form of differentiation, where a company like Sainsbury’s sells the same product as Tesco, but makes it look different to attract more consumers. This will ensure more unique product details, and better prices, making it possible for the retailers to make more profits (HSC, n. d).

Product Differentiation for Varying Consumer Demands

The use of an effective operations management plan ensures that the business focuses on different customer demands (HSC, n. d). For instance, Sainsbury’s is a major retailer that deals in a huge amount of products, which target many different categories of consumers. In order for the company to focus on various consumers as effectively as possible, there is a need to ensure that a blanket strategy is developed, and implemented for the same. Such a strategy is then shared among the many departments of a company such as Sainsbury’s as seen above. Moreover, it is the operations management team that is responsible for the management of production processes up to when products reach the clients. For example, in the fisheries management plan stated above, it is the work of Sainsbury’s to manage fish rearing up to when various finished product are sold to customers (Sainsbury, Punt & Smith, 2000, p. 731). This is an effective way of enhancing product quality; hence, positioning products as of high value in the market.

Interdepartmental Integration

The availability of an operations management plan makes it possible for the business to integrate various departments (HSC, n. d). Just as stated above, the Chief Executive comes up with a strategy, which ensures that the various involved departments know their roles towards the company goals in each project. The manager divides work among the departments and shows them where they need to integrate with other sectors and how they would be able to do it. Without a well-strategized operations management, it would be difficult for the departments to realize how they are supposed to contribute in various roles during the processes involved. This merit makes operations management an important tool of avoiding conflicts and saving time in the process of product development.

Performance Objectives of Sainsbury’s

  • Great food
  • Sourcing with integrity
  • Respect the environment
  • Sound Community Social Responsibility
  • Great workplace for the “colleagues” (J-Sainsbury’s Annual Report, 2014)

4 Vs of Operations Management

  • Volume: Sainsbury’s provides more food for less money
  • Variety: Sainsbury’s provides different types of products in varying tastes
  • Variation: services can be online or on-site, and there are delivery services too.
  • Visibility: product labelling and shelf positioning makes it possible for store shoppers to see what they need. This is the same on the online stores. (Managers Door, 2013).

The operations performance objectives of organisations

Every organization has its own objectives when it comes to operations performance. For many retailers like Sainsbury’s customer service delivery is at the top of everything. For Sainsbury’s, for example, this all begins with the perfect treatment of its staff, using the slogan, “How we manage is how we serve” (Lewis & Trevitt, 2000, p. 6). According to this strategy, a satisfied staff member is usually capable of offering quality services to clients at all times. Therefore, the goal of high quality service delivery for customers becomes realisable. It is also the objective of organisations to ensure that the clients not only get quality services, but also receive quality goods every time they do transactions. For Sainsbury’s, this has been done through effective operations management, for instance through the fisheries management plan, where the production of high quality fish is ensured right from the farm level (Sainsbury, Punt & Smith, 2000, p. 731).

Colleagues who are satisfied always ensure that company goals succeed. Sainsbury’s has always wanted to ensure that its clients come back at all times. In a situation where delivery services are required, happy colleagues will always ensure time is kept (Annual Report, 2011). Through this annual report of 2011, the company found out that it was able to record at least 21 million transactions on a weekly basis, in the food sector, and this was higher than its previous fiscal year (Annual Report, 2011). This was a sign that the operations management’s goal of reduced prices and enhanced product quality worked perfectly, thanks to making Sainsbury’s a “Great Wok Place”.

Businesses also have the goals of enhancing their competitive advantage through growing in other ventures. Sainsbury’s has focused on this by developing non-food sectors to get a larger share of the market (J-Sainsbury’s, 2014). For instance, it developed the banking services as a way of grasping the financial market, to increase its growth. Moreover, other sectors such as the clothing brand, made it possible for the company to multiply its sales, according to the 2011 Annual Report. With these objectives, Sainsbury’s has been able to survive tough competition from many huge and small market entrants, to remain a force in the market, for many years. This is a sign of the important role an effective operations management strategy plays in the development of any business.

References

HSC., (n. d) Part 1: Role of Operations Management.

J-Sainsbury’s. (2014) Board Management

J-Sainsbury’s., (2014) Annual Report and Financial Statements, 2014.

Lewis, R., & Trevitt, R. (2000) Business: Vocational A level. Cheltenham: Stanley Thornes.

Managers Door., (2013) Top 5 – The Four V’s of Operations Management.

Misra, K. B. (2008) Handbook of performability engineering. London: Springer.

Parker, D. W. (2012) Service operations management: The total experience. Cheltenham: Edward Elgar.

Pycraft, M. (2000) Operations management. Cape Town: Pearson Education South Africa.

Sainsbury, K.J., Punt, A.E, & Smith A.D.M., (2000) Design of operational management strategies for achieving fishery ecosystem objectives. Journal of Marine Sciences, 57, 731-741.

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Sustainability IKEA

Sustainability IKEA

The popularity of the issue of sustainability has been growing in the past several decades and it now represents a priority point for the strategic planning and operations of companies, organizations, but also for communities and whole countries (Bell and Morse, 2008). This report addresses one particular area of sustainability from a business perspective and that is the area of monitoring and evaluation.

In order to enable this, the report refers to the theory behind the concept of monitoring systems, indicators and most importantly, the characteristics and features that these systems and indicators need to possess in order to be successful and effective.

To enable a more detailed analysis, this specific sustainability area has been overviewed by applying the selected theory to practice. IKEA has been chosen as the company of interest of this report, and its sustainability efforts, accomplishments and plans have been considered from the perspective of the three sustainability dimensions.

To furthermore focus the research and analysis conducted in this report, one specific dimension of sustainability, the environmental one, has been chosen and reviewed in more depth. In relation to this, an identification and selection of relevant indicators has been conducted and these indicators have been analyzed in terms of their measurement and limitations. The purpose of this was to ensure the tangibility of the indicators and to identify the potential problems that the company may encounter while pursuing the set objectives and goals.

Monitoring Systems

Over the last three decades, sustainable development has become priority for a large number of countries, communities and organizations. All of these expect one thing from their various development programs and projects and that is to deliver results (Bossink, 2012). This is why the ideas and actions that are implemented in these projects and programs have begun to be evaluated form one perspective – whether or not they promote, enable, improve sustainability. But, in order to answer this question, countries, communities and organization in fact have to provide the answers to two other questions – what will success mean and how do we know that this success have been achieved (Gorgen & Kusek, 2009).

Sustainability IKEA
Sustainability IKEA

Monitoring systems are what makes the answers to these questions possible. By definition, monitoring stands for the periodic and repetitive measurement of specific values of variables, and represents one of the crucial factors in the actual achievement of sustainability (Chai, 2009). The sustainability monitoring systems are designed to gather information, cross reference it in regards to a set scale and support the decision making process. The data that is received as a result from the monitoring systems enables the decision makers to assess whether or not they are on the track with sustainability progress and helps them to quickly identify if something has diverted the organization from the planned path and how to quickly move back to it (Devuyst, Hens & De Lannoy, 2001).

In order for monitoring systems to achieve the objectives they have been designed to achieve, they need to be well defined, optimized and tested continuously to ensure their adequacy. But, what they need the most is a good set of indicators that will be used for the actual measuring (Dalal-Clayton & Bass, 2002).

Sustainability Indicators

Indicators related to various aspects of the society have become increasingly popular after World War II. Economic and social indicators have been introduced during the second half of the twentieth century, even though some of them did not manage to capture the political acceptance that they aimed for. In addition to these indicators, the environmental ones began to take up a significant portion of the public attention with the strengthening of the global environmental movement (Lawn, 2006).

After the emergence of all these indicators, sustainability became the No. 1 topic during the 1990’s making sustainability indicators as important as the issue itself. These indicators were first developed by the United Nations, but they have been continually developed and widened with the use of various different approaches (Zoeteman, 2012). The greatest improvements of the sustainability indicators were introduced by a number of non-governmental agencies, and mostly the United Nations, the OECD, the European Union and the World Bank, who have been investing significant resources and efforts into the development of these indicators (Patterson, 2002).

However, their efforts did not end there, which leads to the next most important trend in the development of sustainability indicators. Namely, after setting up the base of indicators, the aforementioned agencies and organizations have attempted to standardize this set across different countries in order to enable the tracking and comparing of the achieved progress in relation to one another. Today, this set of basic sustainability indicators numbers about 200 indicators, about 50 of which are considered as core sustainability indicators (UN, 2013). And even though they have been primarily intended for use by countries, today they are widely accepted and used not only by countries, but also by communities, companies and various organizations (Hak, Moldan & Dahl, 2007).

What Makes Good Monitoring Systems And Indicators?

According to Espinosa and Walker (2011), it is essential that the monitoring system used is well defined and relevant. In addition to a base set of indicators, every monitoring system needs to integrate four crucial elements in order to be successful and efficient. These four elements are ownership, management, maintenance and credibility. Here, ownership stands for and comes from all of those who use the system in every level, or represents the stakeholder of the system. Kusek and Rist (2004) argue that if people who do not recognize the need of such a system or do not have any use of the data collected with the monitoring system, than there will be issues related to the control of the quality.

Management answers the questions of who, where and how will manage the system, which is crucial as it ensures timely collection and distribution of data in order to support the decision making process. Maintenance ensures that the system used will not crash or decay. This means that updates, improvements and control continuously undertakes to enable the renewal, rebuilding and strengthening of the system. Finally, credibility ensures that reliable and valid data are collected with the system, which means that the data will be realistic or not tempered with, and also that both bad and good data will be displayed and used by the system (Kusek & Rist, 2004).

The selection and use of indicators is also one of the main factors that define the quality of the monitoring system in general. When selecting these indicators, it must be taken into consideration that their number should be relatively small and that they should be chosen in accordance with the following criteria (Gosling & Edwards, 2006):

  • Data collected will clearly show whether set objectives have been achieved or not
  • The problems to which the indicators refer are of priority for the organization
  • The data needed is available and it can also be gathered accurately and effectively
  • The data gathered will be used for evaluation and reporting

In addition to these criteria, sustainability indicators should also have a number of other qualities including tangibility, regardless of whether qualitative or quantitative indicators are used, linkage to the set objectives, relevancy for various stakeholders of the monitoring system, they need to be specific, need to reflect different situations, to reflect changes and to have a well-defined and specific baseline data that will clearly show whether results are good or bad (Gebremedhin, Getachew & Amha, 2010).

The Company

The history of IKEA which spread across 6 decades of success actually began in the 1920’s in a farm in southern Sweden where the IKEA’s founder Ingvar Kamprad was born. He pursued the idea of having his own business ever since he was a little boy, and at the age of five, he began his first trading attempts by selling matches to his neighbors. He soon found out that he could buy matches in greater amounts for cheaper price from Stockholm and then sell them with good profits. His matching endeavor was so successful that he expanded his business to selling greeting cards, flower seeds, Christmas ornaments, pencils and pens (IKEA, 2013).

In 1947, Kamprad introduced furniture into his business. He used local manufacturers, enabling him to lower the costs of the items he sold, which led this branch of his company to become very successful. In fact, it became so successful that he soon turned out all of his other products and decided to focus solely on furniture. IKEA opened up its first showroom for the furniture in 1953 (IKEA, 2013).

During the following several years, IKEA began to sell more and more furniture, which soon led it to come into direct confrontation with its main competitor and soon entered into a price war. In order to minimize the expenses as much as possible, and thus make the price war endurable, IKEA started implementing some of the concepts that will eventually make it one of the world’s greatest companies. These concepts refer mainly to stylish and innovative design which enabled flat packaging. This in turn, enabled a minimization of the transportation costs, reduced the damaged acquired during transport, increased the capacity of IKEA’s inventory, and made it easier for customers to take their own furniture home (Parker, 2012).

According to Haig, the innovative approach to packaging and the main focus of IKEA to producing stylish and good quality products at affordable prices is not the only reason why IKEA is being referred to as a concept company. Namely, the spirit of the company, in the words of Kamprad himself, consists of thrift, enthusiasm, humbleness, responsibility and simplicity. These are the very qualities that the company does not implement only in the design of its products, but also in all of its operational practices (Haig, 2007).

The Three Dimensions of Sustainability in IKEA

The extent to which IKEA is committed to sustainable development is evident from several perspectives. Primarily, IKEA has created a sustainable strategy that is systematic and well defined, but has also been upgraded and improved continually. Besides from setting short-term objectives in its annual strategies, IKEA has also constructed a long-term strategy setting its goals and priorities for achievement of sustainable development by the year of 2020. This strategic plan offers concepts and guidelines that the company follows in the achievement of its goals of environmental, societal and economic nature, thus addressing the three dimensions of sustainability (IKEAa, 2013).

The environmental dimension in the IKEA’s sustainability strategy is represented through a number of initiatives and programs which include supply of the wood used for the production of furniture from preferred sources. In 2012, over 22 per cent of the total wood used came from FSC – Forest Stewardship Council certified forests. It is also projected in the long-term strategy that this percentage will be over 50 per cent by the end of 2017. Furthermore, the cotton used in the production of furniture is produced in alignment with the Better Cotton Initiative, and it is planned that 100 per cent of all the cotton used should be such by the end of 2017 (IKEAa, 2013).

The company also invests in the sustainability training of farmers and foresters to ensure that the issues are addressed at the very source. Other environmental initiatives include production and use of renewable energy from the wind, the sun and biomass. In 2012, the company has produced 34% of the total energy it consumed from renewable resources, enabled through the quarter of a million solar panels placed on the company’s facilities and 83 wind turbines that have operated during 2012 (IKEAa, 2013).

The social dimension of sustainability is also addressed in IKEA. Not only that the company is committed to designing and production of furniture that will improve the quality of life for all of its consumers, but also the company makes significant efforts to ensure the rights and well-being of all of its workers. The company also requires that all of its suppliers also be compliant with the people strategy of IKEA. This strategy is based on the UN Guiding Principles on Business and Human Rights that have been implemented. Furthermore, the company also supports the best interests of all children, and implements the Children’s Rights and Business Principles all throughout its operations to ensure the protection of their rights. Finally, it must be stated that part of the sustainable strategy of the company is to ensure that 95 per cent of employees and suppliers as well as 70 per cent of all the consumers consider the company as a company that is highly environmentally and socially responsible (IKEAa, 2013).

The economic dimension of sustainability is represented in both the short and long-term strategy of the company. In fact, in terms of economic performance and growth, IKEA has set a series of goals which include the increase of production and sales volumes of its products to four times by 2020. In the meantime, IKEA is focused on achievement of short-term goals, sales and growth. In 2011, for example, these goals were both achieved as the company has opened up stores in several new countries, finishing the year with 287 stores in 26 different countries, and has managed to increase its global net profits by almost 7 per cent, amounting to a total of 24, 7 billion Euros (The Local, 2012). This indicates that the economic dimension of sustainability still remains to be an important focus of the company.

The Environmental Sustainability Dimension in IKEA

In accordance with what has been stated above about the three sustainability dimensions applied to the operations of IKEA, it is clear that the company is dedicated to all three dimensions equally, and is investing serious resources and efforts to achieve positive financial goals and positive social impact, while reducing the damage and negative influence on the environment, and this is, in fact, the true purpose and goal of sustainability. Considering the nature of business that IKEA runs, and its great impact on the environment in particular, which is due to the use of natural resources as production materials, this dimension of sustainability is especially interesting for IKEA. Indeed, the company needs to employ additional efforts to ensure that the negative impact of its operations on the environment are minimized and/or diminished. This is why this dimension has been selected for further exploration.

List and Assessment of Sustainability Indicators

The importance of the environmental dimension for IKEA is so great that it is necessary for indicators for monitoring this dimension to be very carefully selected. In order to enable this, the criteria for selection of indicators stated above were used. Also, the key features of effective indicators were also considered during the selection. Consequently, a list of several indicators for monitoring environmental sustainability has been created and is given in detail below:

Indicator Definition Measuring Limitations
Increase of FSC certified wood used Ensure that all the wood is certified and comes from companies – suppliers that are also committed to sustainability Percentage of FSC certified wood used in the production of furniture (goal – 100 per cent). Lack of FSC certified companies – suppliers present and operational locally, which may increase total cost of expenditure due to transport and import costs
Increase of Better Cotton Initiative cotton used Ensure that all of the cotton used in the production of the furniture is in compliance with the Better Cotton Initiative Percentage of Better Cotton Initiative cotton used in the production of furniture (goal – 100 per cent) Lack of suppliers aligned with the Better Cotton Initiative present and operational locally, which may increase total cost of expenditure due to transport and import costs
Increase of main furnishing materials used for the production of the furniture that are made from renewable, recycled or recyclable materials  Ensure that all of the materials used in the production are renewable, recycled or recyclable Percentage of renewable, recycled or recyclable materials used in comparison to total materials used None
Production of renewable energy Production of as much renewable energy as it is consumed by the company Percentage of renewable energy produced in comparison with the consumption None
Use of electric vehicles and environmentally safe transport solutions Use of electric vehicles and environmentally safe transport solutions to and from the store to ensure that all aspects of the company related to energy used are from renewable sources Percentage of used electric vehicles from the car parks of IKEA and the proximity – availability of environmentally safe public transport to the IKEA stores Local level of sustainability, government policies

If this list of indicators is analyzed, it shows that all of the indicators selected are very realistic, in line with the priority problems of the company in relation to the environmental dimension of sustainability, and above all measurable. Indeed, for each of this indicator a good base line is identified and it is easy to assess what the progress of the company actually is in its achievement of the set goals and objectives. However, the analysis also shows that there are two types of factors that influence the limitations or challenges related to these indicators. The internal factors are related to the company and refer mostly to the increase of costs of production which is not considered to be a serious problem. The external factors, on the other hand, refer to forces that are outside of the influence of the company. These are mainly related to the existence of suppliers with the desired sustainable operations in terms of certification or compliance. Given that the company acquires its materials and products made by other supplier locally in order to reduce the expenses, this can be considered as a serious problem. However, the demand that IKEA sets on its suppliers may influence setup of such companies due to economies of scale.

References

Bell, S., & Morse, S. (2008). Sustainability Indicators: Measuring the unmeasurable. London, UK: Earthscan.

Bossink, B. (2012). Eco-innovation management and sustainability. New York, NY: Routledge.

Chai, N. (2009). Sustainability performance evaluation system in government. Springer Science + Business Media.

Dalal-Clayton, B., & Bass, S. (2002). Sustainable development strategies: A resource book. London, UK: Earthscan Publications Ltd.

Devuyst, D. Hens, L., & De Lannoy, W. (2001). How green is the city? Sustainability assessment and management in urban environments. New York, NY: Columbia University Press.

Espinosa, A., & Walker, J. (2011). IKEA A complexity approach to sustainability: Theory and application. London, UK: Imperial College Press.

Gebremedhin, B. Getachew, A., & Amha, R. (2010). Results based monitoring and evaluation for organization working in agricultural development. International Livestock Research Institute.

Gorgen, M., & Kusek, J. (2009). World Bank. IKEA Case Study.

Gosling, L., & Edwards, M. (2006). Toolkits: A practical guide to planning, monitoring, evaluation and impact assessment. London, UK: Save the Children.

Hak, T. Moldan, B., & Dahl, A. (2007). Sustainability indicators: A scientific assessment. Paris, FR: SCOPE.

Haig, M. (2007). Brand Royalty: How the world’s top 100 brands thrive and survive. London, UK: Kogan Page Limited.

Kusek, J., & Rist, R. (2004). Ten steps to a results based monitoring and evaluation system. World Bank.

Lawn, P. (2006). Sustainable development in ecological economics. Cheltenham, UK: Edward Elgar Publishing Limited.

Parker, D. (2012). Service operations management: The total experience. Cheltenham, UK: Edward Elgar Publishing Limited.

Patterson, M. (2002). Headline Indicators for tracking progress to sustainability in New Zealand. Wellington, NZ: Ministry for the Environment.

Zoeteman, K. (2012). Sustainable development drivers: The role of leadership in government, business and NGO’s performance. Cheltenham, UK: Edward Elgar Publishing Limited.

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