ORGANISATIONAL ANALYSIS

TEAM MEMBERS:SHEREEN SHAHANASHALI FRANKLINSANDHYA V SSHEBIN THOMAS

Organizational analysis

Organizational analysis is the process of evaluating systematically an organization's capabilities which can give it a competitive advantage in the market.

Also known as internal analysis, company analysis.

Organizational Analysis Models

Strategic Triangle Modelto determine the efficiency and effectiveness of an organization.SWOT modelto evaluate the strengths, weaknesses, opportunities and threats in a business.Rational Modelorganizations should be as mechanistic and efficient as possible.

Natural System Modelopposite of the rational model in that it focuses on the activities that may negatively impact the organization and therefore aims at maintaining an equilibrium in order to meet its goals.Sociotechnical Modelalso known as Sociotechnical Systems (STS).to complex organizational work design that recognizes the interaction between people and technology in workplaces.

Cognitive ModelBehavior, cognitive, and other personal factors as well as environmental events, operate as interacting determinants that influence each other bidirectionally.

VALUE CHAIN ANALYSISProvides framework for organizational

analysisValue chain consist of a linked set of value

creating activities in producing and marketing a product/service

Value chain is divided into primary activitiesSupport activities

STEPS IN VALUE CHAIN ANALYSISCORPORATE VALUE CHAIN ANALYSIS CONSIST

OF THREE STEPS:1. Examine each product line’s value chain in terms

of various activities involved in production. Among those activities, which could be considered a strength or weakness

2. Examine the linkages with each product line’s value chain. Linkages are connections between and support activities

3. Examine the potential synergies among value chains of different product lines so that economy of could be attained.

COMPONENTS OF VALUE CHAIN The components of value chain can be

analyzed by studying1. Organization structure2. Culture and various functions3. Finance4. Marketing5. Operations6. Human resources7. Information systems

1.ORGANISATION STRUCTURE:The following types of organization are widely

found in modern organizations:a) Simple structureb) Functional structurec) Divisional structured) Strategic business unitse) Conglomerate structureStructure should support strategy and it should

facilitateImplementation of strategy if the present structure

is found to be inadequate.

2.Organizational cultureRefers to the shared values, shared beliefs and shared

expectations of employees. Culture is passed from one generation to another of

employees.Corporate culture influences the behavior of people in

the organization.A strong culture promotes survival and serves as

competitive advantage.The extent to which the culture is deep and intense,

the employees tend to show consistent behavior. it is imperative that organization culture is compatible

with a new strategy so as to be an internal strength.

3.Strategic finance issues:It includes cash flow, financial leverage and

capital budgeting, which could be source of strength of firm.

Some of significant factors which decide the financial capability are as follows:

1. Factors related to sources of funds: capital structure Reserves and surplus Relationship with bankers Working capital availability Financing pattern

2. Factors related to usage of funds Fixed asset Current asset Loans and advances Rapport with shareholders Dividend distribution3.Factors related to the management Tax planning measures Cost reduction measures Financial accounting Risk/return management Budgeting system

Some of the techniques that can be adopted for analyzing the strength and weakness in finance area:

Liquidity ratioProfitability ratioLeverage ratioCash flow analysisPayback and IRR analysisBreakeven analysisEarning to salesEarning per share

4.STRATEGIC MARKETING ISSUESMarketing is a crucial function as it links the firm with

customer and competitors.Some of the marketing issues relates to market

position, marketing mix and product life cycle stages.Marketing capability factors with respect to product,

price, place and promotion have direct impact on strategy implementation:

Product related factors:i. Variety ii. Differentiationiii. Product positioningiv. packaging

Price related factors:i. Pricing policiesii. Pricing methodsiii. Government policies Place related factors:i. Logistics ii. Distributioniii. Market intermediaries

Promotion related factors:i. Promotion budget ii. Advertisingiii. Public relationsiv. Sales promotion System related factors:i. Marketing intelligence ii. Marketing information systemiii. Customer relationship management

Techniques are used for analyzing the strength and weaknesses in marketing:

Market share analysisMarketing auditBrand monitoring surveysDealer and consumer panelsAnalysis of profit volume relationship

5.STRATEGIC OPERATIONS ISSUES:The crucial issues involved in operations management

are manufacturing process, mass customization and R&D mix

Some of the operations capability factors are as follows:

1.Factors related to production system:LocationLayoutWork systemCapacityExtent of automationVertical integration

Factors related to operations and control system: Aggregated production planning Material supply Inventory Capacity utilization Quality control Maintenance systemsFactors related to R&S systems: Patents Technology collaboration Technology transfer Technology agreements facilities

Techniques used for assessing the strengths and weaknesses of operations and management:

Capacity utilization analysisInventory analysisCost of production analysisAnalysis of patent generatedNew products commercialization recordComparison of investments in new product

launch.

Strategic Human Resource IssuesStrategic Human resource issues revolve

around labour cost. The use of part time employees, contract workers, autonomous work teams and cross functional work teams provide options and contribute to competitive advantage.

Human resource capability factors are built around personnel systems, employee characteristics and cordial industrial relations.

Factors related to personnel systems:Manpower Planning SystemSelection and Development SystemCompensation and Appraisal System

Factors related to employee CharacteristicsQuality and skill of ManagementImage of Organization as employerWorking conditionsLeadership

Factors related to Industrial relationsUnion-Management RelationshipHealth, Welfare, Safety, Stress, DisciplineCollective Bargaining

Strategic Information Management IssuesA firms Information System Could be a

strength or weakness depending upon its usage in corporate performance.

Successful implementation of strategy warrants information management capability in aspects like acquisition, retention, transmission, dissemination, processing and retrieval of information.

Factors related to acquisition and retention of information:SourceQuantityQualityRetentionSecurity of Information

Factors related to processing and synthesis of InformationDatabase ManagementSoftware DevelopmentDeveloping Suitable SystemFactors related to retrieval and usage of InformationAppropriation of formatsCapacity to assimilate information

Factors related to dissemination and transmission:SpeedScopeDepthWidthCoverage of Information

Integrative, systematic and supportive factors:Availability of personnelI.T InfrastructureCompatibility to Organizational needsTop Management support etc

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