Diagnosing Causes Organisational Challenge -Myassignmenthelp.Com

Question: Discuss About The Diagnosing Causes Organisational Challenge? Answer: Introduction This report integrates management theories with practice and it equips with skills and knowledge necessary for an organisation to be successful. This report draws upon the concepts, tools and applications to broaden the awareness of external and internal environment of an organisation. The aim of the report is to highlight the external and internal factors that an organisation can face and subsequently re-define the management challenges in short and long-term basis. In this report, Aurecon Singapore has been chosen to show the external and internal environmental analysis. Management issues of Aurecon organisation are highlighted and the issues of the organisation can be solved through a combination of management practice and theory. This report is mainly based on secondary data of government reports, industry reports and organisational websites. Overview of the Aurecon Aurecon brings ideas to design a better future for mankind and they try to imagine what is possible. Aurecon tries to turn problems into a solution. Aurecon is an engineering, designing, planning, management and project management organisation. Aurecon is private organisation and it was founded in the year 2009. It has delivery centres in more than 27 countries and it has 80 offices across the globe. CEO of the organisation is Giam Swiegers and Aurecon has been doing notable projects in major parts of Asia. Revenue of the organisation was AUD 900 million dollars in 2016. Numbers of employees in the organisation touched 8000. Aurecon provides advisory, delivery and asset management services across a range of markets (Aurecongroup.com 2018). External Environment analysis Aurecon is in management consultancy industry. PESTEL analysis The political factors that can affect construction project and building designing are regarding the documentation and permits which the companies have to obtain in various stages. In Singapore, Government is robust on the impact of eco-system in construction project and government wants price must be competitive. Singapore government does not impose a new tax that may result in a change of the revenue generation. The political condition of Singapore is stable to flourish the business. Opportunity for construction engineering industry as Singapore economy is flourishing and high-technology in Singapore is also boosting up. Singapore economy is referred to as the most open in the world and it is helpful for pro-business. Current GDP of Singapore is US$ 305 billion and GDP growth is 5.3%. The inflation rate is Singapore is 0.4% and more than 4 million people are in labour force. In building designing and construction projects, the demand can touch US$ 20 billion by the end of 2020 and it was US$16 billion in the year 2016 (Straitstimes.com 2018). Opportunity in construction engineering is that Singapore has third highest per capita income economy, therefore, people can spend more on construction and other projects. Socio-cultural factors scrutinise the community and market factors. In Singapore, people spend lavish lifestyle as disposable income of the people is high. People as consumers change their preference in Singapore. Distribution of wealth in Singapore shows the figure of 0.426 and literacy rate is 95% (Straitstimes.com 2018). The threat in construction engineering is that Singapore is exposed to communal violence frequently that sets the cultural and social harmony back foot, it can lead to stoppage of projects. Singapore has comprehensive infrastructure sect up and it is technologically advanced. Construction of project and building design needs technology help and technology is making changes in the construction industry in Singapore as high technology sector in Singapore is enhancing its quality. Therefore, construction and project industries are observing development with a standalone system. Most of the companies in this industry are moving towards electronically advancement and it can bring opportunity. In Singapore, many of the high-technology companies are making its branch as people are literate and they want to spend more on RD. In Singapore, societies have strict legal norms and Singapore constitution is followed by all. Corruption level is lower than most of the countries as Corruption Perception Index is 9.2 out of 10. Employee policy favours the firms in Singapore and Singapore has SPRING Singapore to follow the Standards, Productivity and Innovation Board (Tremewan 2016). Singapore has Competition Commission and companies must follow the competition rules. In construction engineering, the environmental factor is very important as projects must not damage the environment. Singapore has tropical climate and rainfall can be observed throughout the year. Therefore, the threat is associated with construction companies as they need to use extra security for rains and designs can be influenced by this. Singapore is the member of Environmental Performance Index (EPI) (Rodan 2016). Porters five forces analysis Aurecon is in project management and engineering industry and in Singapore; the threat of new entrant is medium. The construction engineering is the third largest industry in Singapore and it is estimated to US$23 billion (Straitstimes.com 2018). It is not easy for a new company to enter in such a large market without any preparation. It is large scale industry and manpower is needed with the technological specification in order to enter in this field. Construction activities and project management are not fragmented in Singapore. Bargaining power of suppliers Aurecon works directly in projects and suppliers of construction and projects are there in the industry. Materials, technologies and contractors are the most important suppliers for Aurecon. In Singapore, the bargaining powers of suppliers are moderate as numbers of suppliers are not high. For suppliers, the industry is attractive as suppliers have many things to supply to engineering Consultants Company. This force is medium. Bargaining power of buyers In the market for engineering consultant, the market rivalries are large. Therefore the buyers can switch easily to other company. In addition, the customers of the service from Aurecon are large companies and they are rich. They research well about the price and companies have to quote the price. Aurecon works in different markets and therefore, numbers of customers are large for the company. This force is high. Threat of substitutes In Singapore, in the urban sector, construction engineering companies are making residential, commercial and industrial buildings along with roads, sewers, bridges and high ways. Substitutes in the market are high; however, in Singapore, it has already built Buddha Tooth Relic Temple, Crown Plaza hotel exterior, land Lease Regional Head Office and The Sail at Marina Bay (Aurecongroup.com 2018). Therefore, the threat of substitute is moderate. Rivalry in industry In Singapore, numbers of foreign workers are large and labour force is high with foreign workers. Engineering and construction companies in Singapore are many, Marx Construction Project, Faithful Gould, KTC, GS Engineering and Construction and CGW Construction and Engineering. International players are PWC, Deloitte and KPMG in Singapore market (Ahmadabadian et al. 2016). A price war is seen in the industry as offering lower price can attract the more customers. Therefore, industry rivalry is high in this industry for Aurecon. This force is high. Industry Life Cycle Curve The industry life cycle is based on mainly business characteristics and it has four phases. Industries are started when new service or product is developed and industry can face the issue of uncertainty of the market size. At the conception stage, early marketing and development of new service or product are started by engineering consultant Aurecon. Innovator Aurecon starts new service to enable the proliferation o offer. Consumers get to learn about the product or service and industry is fragmented in conception stage (Lpez-Gamero and Molina-Azorn 2015). Consumers get to know about new offering and its values. Consumers start to purchase the service or products. Similarly, in the growth stage, Aurecon offers the service to large numbers of customers and they establish a share in the market. In maturity period, the growth of the industry becomes slow and Aurecon focuses mostly on expense reduction. In maturity stage, Aurecon can also face that barrier to entry becomes higher. Aureco n in this stage starts to focus on market share and the primary goal of the company is cash flow. Management engineering consultancies industry is observing the maturity phase as companies are consolidating and level of economic importance is getting stable (Wheelen et al. 2017). High growth is observing in economic importance, technology and market are developing. In the declining phase, the engineering consulting industry is not able to support growth. It shows a decline in revenues and it also leads to weaker competitors out of the industry. Customers needs regarding operational performance Price: It is the amount that has to be paid in order to get the service. In Singapore market, Aurecon provides the service at less fixed cost as numbers of competitors are high. Customers want fewer prices with the highest value. Quality: Customers want consistent performance and the best quality from the companies. Customers want error-free service and maximum choice from companies. Customers want the best specification of the services and the services or products must be the best in the market. As stated by Grant (2016), quality management practices of the organisations must be transparent so that customers have the confidence to purchase the services or products. Dependability: As opined by Frank et al. (2015), dependability can be defined as the quality of being able to be counted or relied upon. Customers want to purchase from the organisation where they can invest without any a headache and they expect that the organisations must keep the promises. In engineering consulting service, customers want that they can depend on the organisations in construction or projects. Flexibility: Aurecon increased the business volume as the company generated $999,980,000 total revenue including sales and revenue. Aurecon is focusing to increase the delivery flexibility as it has more than 80 offices in more than 27 countries. Customers want maximum service flexibility to choose from (Aurecongroup.com 2018). Speed: Speed is the elapsed time between customers request the service and receiving the service back. In public sector engineering construction and projects, the speed of operation is slower than the private sector in Singapore (Bennett and Chorley 2015). Aurecons offerings to the performance objectives Aurecon provides best price offering in the Singapore market and the service is efficient for the customers. The company provides quality services to the customers aligning the top management commitment and leadership. Quality in engineering consultancy is related to the men, material, machines, money, metrics and methods (Chen and Duan 2014). In Singapore market, Aurecon provides the service at the competitive prices. The speed of the organisation differs as the project has to pass the government and local regulation. Aurecon provides delivery flexibility as it has many branches across the globe. The organisation has expertise in architecture and engineering company and it has service and products of construction property, manufacturing, property and defence. Organisations may have the best business strategy; however, they need to convert the strategy into action. Aurecon has threshold competence as it reserves the skills that an organisation needs to have to saleable the products or service to the customers (Chen and Shao 2017). Aurecon has engineering ideas in various markets and it has a number of subsidiaries as well. The organisation has financial viability; however, the presence of competitors in the market makes the situation hard for Aurecon. Resources Competencies Physical Machines, building, products, materials, patents, database, computer system Ways of achieving utilisation of plants, flexibility, efficiency and productivity Financial Cash flow, balance sheet, suppliers funds. Revenue of Aurecon was US$ 900 million dollar in 2016 Ability to raise funds and manage the cash flow, creditors and debtors Human Aurecon has more than 7000 employees all over the world and it has leaders, managers, suppliers and partners globally The organisation needs to use experience, skills, knowledge and build relationship to motivate other people Table 1: Strategic capabilities of Aurecon (Source: Self-developed) VIRO Analysis Valuable Rare Imitability Organisation Competitive implication Price positioning Yes Yes Yes No Aurecon has extra advantage in price war Market proximity Yes No Yes Yes Competitive advantage Innovation Yes Yes Yes Yes Aurecon likes to convert problem into solution Local adaptation Yes Yes No Yes International design in local areas International presence Yes Yes Yes Yes Aurecon has its office in more than 27 countries Customer service Yes No No Yes It offers service in many markets Table 2: VRIO analysis of Aurecon (Source: Self-developed) SWOT Analysis Strengths (S1) Have advanced technology (S2) Workforce stimulation (S3) Use of modern machinery (S4) Developed partnership with material suppliers and concrete manufacturer Weaknesses (W1) Capital expenditure by private sector (W2) Industry consolidation (W3) Value proposition (W4) Train the employees in engineering and consultancy environment and Uncoordinated workers Opportunities (O1) Favourable contractor terms and financing method (O2) Possibility of working on future projects (O3) Diversify business in many markets Threats (T1) Cost-conscious environment (T2) Expansion of AI (Artificial Intelligence) and VR (Virtual Reality) (T3) Hyper-competitive market Table 3: SWOT analysis of Aurecon (Source: Self-developed) Value chain analysis Support activities Firm infrastructure Aurecon has good infrastructure as in Australia they have more than 6000 employees and in Singapore, they have 1000 employees. The organisation has more than 88 branches in more than 27 countries. Every associate in business tries to reduce the cost of doing the business. Human resource management Overall, Aurecon has more than 10000 employees across the globe. Moreover, it has many labourers to complete their work and they work on contract basis. Technology development In last five years, mining-related project and large-scale infrastructure have been declined; therefore, Aurecon Singapore has declined the annualised expense in technology. Aurecon uses large construction technologies, designing software and engineering consulting technologies (Aurecongroup.com 2018). Procurement Aurecon purchases the goods and service and it processes different routes to construct or design the project. The process of purchasing the products follows the speed, cost, quality, financing and asset ownership. Primary activities Inbound logistics Aurecon does pre-planning when they work a project. They use broad network careers. Aurecon uses third-party logistics and they adhere to the strict rules of logistics. The company uses Last-in-first-out method in order to store the materials. Operations Aurecon makes the planning and designing the project. They talk to indirect suppliers and after that, they discuss to direct suppliers. Aurecon discusses with contractors. Contractors and Aurecon both discuss Contractee'. In operation process, Aurecon plans the project at the initial stage and they execute this after discussing the clients (Robinson and Choy 2016). Outbound logistics Movement of the materials from the storage is referred to outbound logistics. Aurecon does the designing and project engineering and they do it with coordination and equipment. Marketing and sales Aurecon has brand awareness in the Singapore and Australian market. They d the marketing through networking in business. Service They provide service on aviation, construction, defence, energy, education, health and manufacturing. Confrontation Matrix Opportunities Threats O1; Favourable contractor terms and financing method O2: Possibility of working in future projects O3: Diversify business in many markets T1: Cost-conscious environment T2: Expansion of AI (Artificial Intelligence) and VR (Virtual Reality) T3: Hyper-competitive market Strengths S1 2 3 1 2 S2 1 2 S3 3 S4 3 2 Weaknesses W1 2 3 W2 3 1 3 W3 2 3 2 W4 2 3 2 1 Table 4: Confrontation Matrix of Aurecon (Assigning 3 to the best one, 2 to the next best option and 1 to the next best option) (Source: Self-developed) SO: It is idea matrix and Aurecon can use their advanced technology in order to finish their future projects. They have markets in diverse fields and they can use their concentrators and suppliers. WT: Aurecon needs to avoid doing these. They need to train the employees in AI and VR. Aurecon needs to propose the value. WO: This is risky for Aurecon and capital expenditure in future projects need to check by Aurecon. ST: Aurecon can do multiple channel promotions to overcome the competitive threat and market consolidation issue. Problem Statement and challenges of the organisation Aurecon In Singapore, the management consultancies have demand and they have large corporate clients. The market researchers expect good growth in the market of Singapore and Australia. Issues from competition and industry consolidation In addition, Aurecon has been facing the issue of increased competition in the Singapore market after entering of PWC, KPMG and Deloitte. These companies are international players and they have a large market share in international market. In Singapore, engineering and consultancies companies have grown slowly due to the poor demand from the key downstream markets. Numbers of projects from other companies are going to increase in next five years. Aurecon needs to increase their market share by marketing and lobbying. Value proposition Singapore has a wealthy economy; however, an organisation needs to propose their values why a consumer must buy their service or products (Liao et al. 2015). Aurecon is in many markets; however, customers need to know their offerings. Therefore, Aurecon is facing the issue of the value proposition as they do not have the statement that convinces a consumer about their service. Train the employees in engineering and consultancy environment The management of Aurecon has been facing the issue of lack of experienced and trained employees. On-the-job training to the employees to train about specific skills is needed. Designing and project engineering works need both creativity and skills. The employees should know about using technologies and software as well. Conclusion It has been noted that management and consultancies companies have been facing the sloth economy in the industry in last five years. The industry is expected to increase in coming years as Singapore has a wealthy economy. Singapore has been observing an increasing amount of acquisition in engineering consultancy and industry value is added is growing faster than the economy. Aurecon is facing the issue of industry consolidation as many international players have come to Asia Pacific region. Aurecon brings the technological change in the market. Growing competition with existing companies and international companies can be challenging for Aurecon. Aurecon is facing the issue of lack of skilled and trained employees. Value proposition from Aurecon can increase their market value in Singapore market. Reference List Adriaenssens, S., Block, P., Veenendaal, D. and Williams, C. eds., 2014.Shell structures for architecture: form finding and optimization. Abingdon: Routledge. 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