Organizational Behavior in Health Care: Case Study

Organizational Behavior in Health Care: Case Study Preparing Staff for Transition According to Borkowski in her book on Organizational Behavior in health care, she depicts the numerous changes that individuals are anticipated to portray in cases of a changes in an entity. The area that the book has concentrated on more specifically is on the health organizations. Through the first three subtopic namely, diversity in health care, attitudes and perceptions in addition to workplace communication, she has focused her attention to providing the readers with concise and clear overview from a health care managers point of view. This particular knowledge will be helpful in outlining the crucial areas concerned in preparing staff transition when merging Springdale health organization with St Marys HMO. Among the number of aspects that an organizational behavior especially in a health setting looks into include diversity, motivation, stress, power, leadership, management, group dynamics and ways of approaching management changes (Borkowski, 2010). Borkowski has expounded adequately on each factor and how it can be approached and addressed. At the same time the author has presented, learning objectives, a number of activities like evaluations and self assessment exercises and case studies in each chapter to increase the readers comprehension on the different ideas that have been tackled in the chapter. To say that this text is not helpful to learners is an infringement; the text is arranged in a way that helps bring out the ideas and facts in an arranged organized manner that helps increase the comprehension of the readers. Both practical encounters and the theoretical parts of the book help bring out the rigor making it very applicable and appropriate to students both at the undergraduate and post graduate levels of education (Borkowski, 2010). Apart from the students, health care mangers are provided with a critical insight on comprehending the dynamics and problems that are deemed to be encountered at the work place. The book thus provides a solution into how different ideas should be approached in order to increase an organizations probability of achieving set targets and goals. Through this understanding, workers morale is improved and this leads to an increase in productivity. The book also provides practices and theories essential for health organizations. It is thus undisputable to say that the ideas brought forward by this text in regard to meeting and satisfying constant organizational behaviors that are challenging modern organizations. The text presents us with a myriad that confronts modern health organizations and how to successfully approach such instances. Diversities in workplaces Diversity in work places is one of the issues that the organizations should take into considerations if their organizations have to perform optimally. Diversity in work places involves the differences that are exhibited by the employees of the company. The differences as portrayed by the employees of the organizations are according to the race affiliations of the employees, the gender, religious faith professed, disabilities, sexual orientation, physical appearance and the nationality. The diversity in the places of work can be used as strength to the organization since people would come with the ideas that are meant to improve the performance of the organization and thus enable the organization to meet its goals and objectives. On the other hand diversity can be a source of failure to the organization especially where the management does not work to acknowledge different ideologies brought to the organizations. The management of the organization should come with ways to prevent poss ible conflicts in the organization as a result of the diversities exhibited by it employees (Borkowski, 2010, pp.15). In many organizations today they acknowledge that the diversity in the organization is the source of success to the organization. It would be absurd for the organization to hire people who thing alike because the generations of ideas would be limited and thus dismal performance of the company would be recorded. In order for the organization to tap the benefits brought by the diversity of their workforce, the organization should be geared towards forming diverse-work-relationship which is important to ensure the success of the organization. For the transition program to be successful, both Springdale health organization and St Marys HMO ought to come with the programs that are meant to reward diversities in work places for instance organize cultural fairs to acknowledge people of different cultures that are present in the organization, have maternal leaves in order to enable women in the organization have time to nurse their children and also have a way of rewarding skills and special talents possessed by the organization for instance through job promotions, monetary reward and recognition of the individual as having played an important role in the success of the company (Mathis, 2007). Workplace communication Effective communication is important in the organization just like in any relationship. In an organization the takes place every other time in form of issuing order to the employees of the company by the management or through the communication of the report or findings of a give assignment to the management by the employees of the company. Thus for the business organizations to ensure it successes in the industry, it should be in a position to ensure accurate, relevant and timely information is passed to the intended parties for decision making. In the organization the communications is made to different stakeholders constantly. Importantly the business is in communication with its employees. Communications can either be from the management giving policies to be implemented by the employees. On the other hand communication can be from the employees of the organizations communicating the findings of the assignment given by the management of the organization. Lack of the effective communications between the management the employees can lead to the frustrations and killing morale and thus dismal performance of the organization. The business is in communications with its customers when it wants to communicate on the delivery of goods to the customers, for instance. Like the customers of the organization communicate with the organization when they are placing orders, want to make payments for the goods supplied and when they want to lodge complains to the company. The organization is also in communication with its suppliers of th e raw materials to the company. When the company devises effective communications with all the stakeholders, it ensures success in the organizations; the effective communication is paramount in ensuring the company meets its goals (Borkowski, 2010, pp.72). There are many sources of lack of communications or presence of poor communication in the organization. In the organizations nowadays, lack of clear instructions from the management to the employees on the accomplishment of the tasks remains to be the major source of problem in the organization. It is pathetic to note that employees of the company lack the information they need to carry out a given task in this era where information is flooded in the society. When the instructions are not clear, the employees fail to perform that task and hence the organization fails to meet its goals and objectives. Effective communication in the organization is hindered by among other issues by the management creating a conducive environment where the information can be shared freely. Employees fear that when their share information in the organization would be reprimanded or intimidated and thus opt to keep quit rather than go through a humiliating ordeal. The management should come with the rewar ding systems that encourage the employees of the company to share their ideas and thus leading to improvement in working conditions and thus success of the organization. Another source of poor communication in the organization is the conflicts among employees themselves. Employees of the company may not be in good terms with other employees and thus inhibit sharing of the ideas. It is therefore the sole obligation of Springdale health organization and St Marys HMO organization to come up with systems that ensure the employees share information they have among each other and also avoid instances that would lead to conflicts for instance defining roles of every employee as defined in performance contract and also in organizational structure. Leadership Styles Kippenberger, (2002) says leadership deals with how much a person can influence and motivate people. Some have considered leadership to be innate, this implies that leaders are born; others have disputed this fact and have termed it to a blatant lie saying that leaders are made. Despite all this contradictions, they all agree that leaders are people who have the ability to guide and influence people towards achieving stipulated goals with the most effective means. How one becomes a successful leader is not defined by oneself or those above you, the people who define successful leaders are those under you. The degree of influence you inculcate in them towards a given direction is what will define how successful you are as a leader (pp.110). A number of leadership styles have been forwarded. A leadership style deals with the approach and manner of approaching, implementing and influencing a given group f people. The different leadership styles are applicable to different organizations and groups of people. This therefore means that, a style that is very fruitful in one organization may or may not be applicable to another organization or a given group of individuals. The different styles thus are applied to different entities and situations. Three types of leadership styles have been established and can be used by leaders depending on the situation at hand (Kippenberger, 2002, pp.110). Most leaders although, operate with one dominant leadership style with the others coming handy depending on the need. Paton McCalman (2008) considers autocratic leadership style to be used in giving directions and ultimatums. Leaders often employ such a style when they are directing their employees on what they want them to do and the way it should be done. This style is very appropriate in cases when there is an emergency and the leader wants to solve a given problems, when one is short of time and in instances when the leaders have managed to motivate their employees well. In some situations, a number of individuals have considered this leadership style as a yelling vehicle, where the leader is to use very demeaning words and language to employees and even abuse of power. This in regard to business can not be termed to as the authoritarian type of leadership but an unprofessional style that has no place in the leadership repertoire (pp.119). The other leadership style is referred to as the democratic leadership. This leadership style is involves the employees being included in the decision making processes because all the processes made in an entity will affect the people in one way or the other. The style allows the employees to identify what they will do and how. Despite the employees being allowed to bring their opinions and suggestions in to the decision making process, the leader is the one with the final say and maintains the final authority regarding all the decisions. When such a style is applied, many have considered it a weakness, rather it is a strength where the leader has the confidence the employees will be able to respect the democratic process and the decision arrived at. The democratic leadership style is applicable in cases where both parties have information i.e. the leader has some pieces while the other pieces are held with the employees (Kippenberger, 2002, pp.114). Employers do not have to know eve rything, and this is the reason as to why employers employ people who are knowledgeable and skilled. It is also applicable in makes the employees fell part and parcel of all the undertakings in the firm and thus they watch their entire single moves. Lastly, the third leadership style is the free reign or the delegative leadership style. The employees in this leadership style are allowed to make and arrive at their own decisions. Despite this, the leader is still in charge of everything and he makes the final call on decisions made. The style is applicable in cases where the employees have the competencies to analyze a situation and come up appropriate decisions and what to be done. It involves delegation of duties since you can not be able to do every thing. Groups and Teams In addition, both Springdale health organization and St Marys HMO, should strive to manage both the teams and the work groups. It should be acknowledged that all teams are a form of work group but not all work groups are teams. There are three types of work groups namely; dependent work groups, independent work group and interdependent work group. Dependent work group are under the control of the supervisors who control the whole group. Independent work groups are also under the control of the supervisor but the supervisor is the boss as it is the case in dependent work group. In interdependent work group, the members of the group rely on one another to have a certain task accomplished. The organization should ensure that the members of the work force work as a group in order to realize full potential of all workers in the organization. In this era where the organizations emphasize on the division of labor and specialization, an employee to perform in the are where they are best tale nted in, the organization should ensure that that every employee carry out a specific task in the group in order to have the maximum benefits for the entire organizations. Attitudes and Perceptions Though change is very inevitable, workers reacts to the idea with very mixed reactions. This is because change in any institution or condition will have to alter a thing or two. Especially with the current business environment, entities are geared towards attaining global standards for their survival. With the change taking place in organizations, there is a reflection on the emotions and psychological reactions of the labor force as they try to come up with resistance measures of the phenomenon. This means that if not well approached, a lot resistance shall be exhibited by the labor force. A very significant point regarding change is that it can not be forced down the peoples throats (Borkowski, 2010, pp.41). Change is accompanied by a number of ideas. There are those who may risk loosing their jobs, there may be the restructuring of the entire organization leading to being transferred to other departments and there may be complete new leaders who may come into the entity. Change in organizations has entirely been identified as the cause for depressions and stress among the workers in an entity. Borkowski (2010) asserts that the risks that accompany change are very fatal than any other business undertaking. Change the norms of an entity and trying to follow an unknown direction. This thus requires a lot of faith and having the trust that something better will take place. Workers believe that with change, they will loose their total control over the things they used to do in an entity. Taking a faithful leap among the employees is not an easy thing and most do not have the courage to take such risks, so the best they can do is try to resist the changes (pp.42). Motivational strategies The employees of the company should be well motivated in order to improve their performance in order for the realization of the goals of the organization. The employee should be appreciated and thus feel to be part and parcel of the organization; employees are one of the most valuable asset in the organizations and they should be handled well to ensure that the organization attains its goals. There are motivational strategies that have being identified that management of the organization could use to ensure that the employees are well motivated. One of the motivational strategies is team work; the management should form work group with the hope that the peer pressure among the employees would improve the performance of the organization. Team work as a motivation strategy has worked effectively since every employee would want to work hard to meet the expectations of other members of his group rather than the expectations of their supervisors. The second motivational strategy available to the organization is the personal involvement; the management of the organization should allow the employees to be involved in placing their standards. The employees should be allowed to make commitment of what they intend to achieve in the organization, this would give the employees the zeal to attain the goals they have set for themselves. Work enhancement is another motivational strategy; the work is structures in the organization in such a way that it has fulfillment to the employees. Management can motivate workers by issuing to them rewards either in form of monetary things or non monetary goods; this would make the employees to work hard in order to recoup the prizes offered by the management. The management also request for th e mutual exchanges as a way of motivation; the management may do some favor to the employee for the return of a given level of performance. The management can also place a competitive reward for the employees in form of a prize; the employees would work hard in order to receive the prize. And lastly the management can punish or inflict fear to the employees to ensure performance; the employee who does not performance is suspended of sacked and thus the employees would work hard to avoid such punishment (Brehm, 2004, pp.119). Resistance to Change There are a number of reasons that may make people to resist change. Some of the reasons are associated with the normal norms of the old firm and the people who would like to be identified by the old ways of the firm (Tobin, 2009, pp.30). People are identified as social beings, through this, we would like to remain attached and connected to some things and people especially those whom we know, those who we have learnt from and those that we are familiar with. It is this kind of royalty that helped our ancestors to defend themselves ands hunt (Kippenberger, 2002, pp.224). And to show its effect, we are much glued to those whom we know and resist any form of change that may seem to compromise these situations. Secondly, there may be resistance to change amongst the people of a given organization due to lacking role models in the new assignments that one is expected to take up. Through observation, one earns a lot and knowing that you will never have this learning opportunity compromises an individual making him resist changes. Tobin (2009) views lack of competence in new tasks to also lead to change resistance. New tasks may require new ideas, skills and knowledge and this may make people not to allow change to take place in an entity. This is especially if they perceive the changes as a danger to their existence and job security. For instance, in the merging in the case study above, it is clearly put that some employees will have to loose their jobs while others will be incorporated to other departments. This is a clear indication that change can never be welcomed into an organization if the employee considers the risks unbearable (pp.30). Conclusion In conclusion, the management of Springdale health organization and St Marys HMO should handle their employees well to ensure that the organization has met its goals and objectives. It should be noted that the employees of the company are the most important assets of any organization and that they should be managed effectively to ensure that the organizations perform optimally. The management of the organization should recognize that the diversity among the employees is the strength that should be exploited for the benefit of the organization. The management should ensure effective communication in the organization, sharing of relevant, timely and accurate information to all stakeholders in the organizations should be ensured for decisions making. The management should ensure that the employees of the organization are well motivated and thus ensure performance. History Of Oxfam: Non Profit Organisation History Of Oxfam: Non Profit Organisation (Oxfam International was formed in 1995 by a group of independent non-governmental organizations. Their aim was to work together for greater impact on the international stage to reduce poverty and injustice. The name Oxfam comes from the Oxford Committee for Famine Relief, founded in Britain in 1942. The group campaigned for food supplies to be sent through an allied naval blockade to starving women and children in enemy-occupied Greece during the Second World War. As well as becoming a world leader in the delivery of emergency relief, Oxfam International implements long-term development programs in vulnerable communities. We are also part of a global movement, campaigning with others, for instance, to end unfair trade rules, demand better health and education services for all, and to combat climate change. Today, there are 13 member organizations of the Oxfam International confederation. They are based in: Australia, Belgium, Canada, France, Germany, Great Britain, Hong Kong, Ireland, The Netherlands, New Zealand, Quebec, Spain and the United States. The Oxfam International Secretariat is based in Oxford, UK. The Secretariat runs advocacy offices in Brussels, Geneva, New York and Washington DC) (www.oxfam.org/en/about/history). Oxfam Ireland (It works with people around the world to end the injustice of poverty. They are an independent and secular not-for-profit organization. Oxfam Ireland is a member of Oxfam International, a confederation of thirteen independent members. The members work together to achieve greater impact by their collective efforts).(www.oxfam.org/oxfamhome Oxfam is many different things. Its the organization which helps poor people to build a better future for them. Its the relief agency which brings help when disaster strikes. And Oxfam is the campaigner for a fairer world. Through our work in long-term development, emergencies and campaigning, Oxfam helps people to achieve their right to a life free from poverty, suffering and injustice) (www.oxfam.org). Im doing my workplacement in the Oxfam shop of Rathmines-Dublin 6. this shop considers as one of the Oxfam International branches. In this shop, they get various donations from the public. The work carried out by this shop, they sell good quality bric a brac, cds, books, homewares, clothes, shoes etc. They shops costumers those people who want to buy good quality and different thing at the same shop. Organisation Chart Oxfam shop- Rathminess Chart The structure of the shop as you see in the diagram is flat. Thats means the shop has relatively few levels in the hierarchy. The structure looks like span of control that the volunteers directly reporting to the manager. The explanation of the Chart The role of the manager The manager is fully responsible about the shop, how to make the budget for example about (purchasing, selling, pricing, coding, and sorting the donation which he/she gets it from the public. If the donators make a complaint whe/she will: investigate fully do her/his best to explain what went wrong try to put things right At this shop, she has own office, and she works with volunteers helping teaching them how they can get on. Deputy Manager She/he is fully responsible about the shop doing the same role when the manager is off. The staff (The Volunteers) The Volunteers in this shop are the staff of the shop, they are 45 volunteers, I put them in the diagram regarding to their presence over the week. On Monday, the shop has 6 volunteers, some of are student from second and third Level doing their Workplacement. On Tuesday, there are 10 volunteers. On Wednesday, there 8 volunteers. On Thursday, there 9 volunteers. On Friday there 9 volunteers. Finally, on Saturday, there 5 volunteers. Those volunteers are working together at very peaceful atmosphere and working very hard. After they know what they should do, they do pricing, sorting, coding the donations, so they help the manager a lot. My duties in this shop I come every Thursday and Friday (full day), I sometimes work at the Till, sometimes pricier, coder, sorter of the clothes and dealing with customers. (B) Scanning the Internal Influence on organisation: There two influences on the organisation (the Oxfam shop) Resource Base View (Typical answers might refer to : Excellent service Technical know-how Responsiveness to market needs Design and engineering capability Financial resources Basic principles of the RBV model RBV of the firm provides a rigorous model for analysing firms strengths and weaknesses Basic assumptions of RBV : Resource and/or capability heterogeneity : different firms possess bundles of different resources and capabilities Resource and/or capability immobility : Some of these resources and capabilities are inelastic in supply or costly to copy RBV posits that the sources of value creation are resources and capabilities Value = Consumer surplus + Producer profit To outperform industry norm, a company must create more value than its competitors Value Chain Analysis has two basic activities Primary Activities (Inbound logistics, goods or donations from the public of the shop being obtained from the shop suppliers ready to be used for producing the end product). (Notes given in the class). Operation, the raw materials and goods obtained are manufactured into the final product. Value added to the product at the stage as it moves through the production line. Outbound logistics, once the product have been manufactured they are ready to be distribute to distribution centres, wholesales, retailer or customers.)(Notes given the class). Marketing and Sales, Essentially an information activity informing buyers and consumers about products and services (benefits, use, price etc.) Service All those activities associated with maintaining product performance. (2) Secondary Activities Procurement, his concerns how resources are acquired for a business (e.g. sourcing and negotiating with materials suppliers) Human Resource Management, Those activities concerned with recruiting, developing, motivating and rewarding the workforce of a business. Technology Development, Activities concerned with managing information processing and the development and protection of knowledge in a business Starting point for a unifying strategic framework : THE RBV of the firm The RBV of the firm is grounded in economics RBV sees companies as different collections of physical and intangible assets and capabilities, which determine how efficiently, how effectively a company performs its functional activities Attributes competitive advantage to ownership of valuable resources and capabilities that enable a company to perform activities better or more cheaply than competitors Combines internal analysis with external analysis Resources Are defined as stocks of firm-specific assets Cannot be easily duplicated Cannot be easily acquired in well-functioning markets Examples: Patents and trademarks Brand-name reputation Installed base Organizational culture Workers With specific expertise or knowledge Contribute either directly (e.g., reputation) or indirectly (e.g., through serving as the basis of capabilities) to value creation Are converted into final products or services using bonding mechanisms such as IT, incentive systems, trust, etc. Sometimes non-specific resources (like buildings, raw materials, unskilled labor, etc.) are included in the definition of resources Resource categories : Financial capital Physical capital Human capital Organizational Capital Capabilities Are defined as cluster activities that a firm does especially well in comparison with other firms o May reside within business functions (e.g., AA yield management) o May be linked to technologies, product design (e.g., Honda engines) o May reside in firms ability to manage linkages between elements of value chain, i.e., coordination skills (e.g., Ford product development) o Refer to a firms capacity to deploy resources, usually in combination, using organizational processes to effect desired ends Information-based, firm-specific processes which are created over time through complex interactions between resources Key characteristics : o Valuable across multiple products and markets o Embedded in organizational routines (well-honed patterns of performing activities) o Tacit (i.e., difficult to reduce to algorithms, procedure guides) Resources and capabilities are distinct from key success factors Key success factors (KSF) Refer to the skills and assets a firm must have to achieve profitability in a particular market Market-level rather than individual characteristics Necessary, not sufficient for achieving competitive advantage (e.g., KSF in athletic footwear are development of new designs, management of a network of suppliers and distributors, creation of marketing campaigns) Predictors of firm profitability (like resources and capabilities) Resources and capabilities Are conceptually different from KSF Sometimes overlap with KSF A FRAMEWORK FOR ANALYSIS : VRIO Resource-based analysis of the firm determines which resources and capabilities result in which strengths or weaknesses Strategies are to be implemented which exploit (or build) strengths and avoid (or eliminate) weaknesses What constitutes a strength or weakness is partially a function of the external environment Framework for analysis: VRIO resources and capabilities should be o Valuable o Rare o Inimitable o Organization can effectively exploit them VALUE of resources and capabilities A VALUABLE resource or capability (or a combination thereof) must Contribute to fulfillment of customers needs At a price the consumer is willing to pay, which is determined by Customer preferences Available alternatives (including substitute products) Supply of related or supplementary goods Thus, value is partially a function of external environment (product market, demand forces) changes in consumer tastes, industry structure, technology, etc. can result in changed value Resources of different firms can be valuable in different ways (e.g., Timex versus Rolex) Value = Lowered costs or increased revenues or both SCARCITY of resources and capabilities Resources and capabilities must be in short supply to create competitive advantage (and go beyond competitive parity) What would happen if this were not the case? An analysis of the firms resources and capabilities must include critical assessment whether they are unusual when compared to those of competitors How rare does a resource have to be in order to have potential for generating a competitive advantage? Example of a rare resource: Wal-Marts point-of-purchase inventory control system To be a source of sustained competitive advantage the rarity of the resource must persist over time INIMITABILITY of resources dans capabilities Requirement for sustained competitive advantage Ease of imitation depends on Cost asymmetries (Do firms without a resource or capability face a cost disadvantage in obtaining it compared to firms that already possess it?) Capabilities of competitors Sources of cost asymmetries / cost disadvantages fall into two categories : Impediments to imitation : Impede rivals from duplicating critical resources and capabilities Early-mover advantages : Set in motion a dynamic that increases the magnitude of that advantage relative to other firms over time Impediments to imitation : Legal restrictions on imitation : Patents, copyrights, trademarks Governmental control over entry into markets (licensing), certification, quotas on operating rights) Superior access to inputs or to customers Market size and scale economies Intangible barriers to imitation Causal ambiguity Dependence on historical circumstances Other path dependencies Social complexity Degrees of resource and capability imitability Source: C. Montgomery, Resources: The essence of Corporate Advantage, Harvard Business School Case N1-792-064.  · Cannot be imitated : Patents, unique assets, unique locations  · Difficult to imitate : Brand loyalty, employee satisfaction, reputation for fairness  · Can be imitated (but may not be) Capacity preemption, economies of scale  · Easy to imitate : Cash, commodities ORGANIZING to exploit competitive potential of resources and capabilities The following elements must be in place in order to effectively exploit the resource(s) and/or capability(s): o Structure o Management and control systems o Compensation policies Business processes o Complementary resources and capabilities)(www.ecofine.com/strategy. (C) External influence on organisation This consist of PEST Analysis and Five Forces analysis PEST Analysis (A scan of the external macro-environment in which the firm operates can be expressed in terms of the following factors: Political Economic Social Technological Political Factors (Political factors include government regulations and legal issues and define both formal and informal rules under which the firm must operate. Some examples include: tax policy employment laws environmental regulations trade restrictions and tariffs political stability) Economic Factors Economic factors affect the purchasing power of potential customers and the firms cost of capital. The following are examples of factors in the macroeconomy: economic growth interest rates exchange rates inflation rate)(www.quickmba.com/strategy/pest) Social Factors (Social factors include the demographic and cultural aspects of the external macroenvironment. These factors affect customer needs and the size of potential markets. Some social factors include: health consciousness population growth rate age distribution career attitudes emphasis on safety) Technological Factors (Technological factors can lower barriers to entry, reduce minimum efficient production levels, and influence outsourcing decisions. Some technological factors include: RD activity automation technology incentives rate of technological change)(www.quickmba.com/strategy/pest). Political Economical Social Technological Environment regulation and protection Exchange rate Income distribution Government research spending Tax policies, may affect on Oxfam as a whole Taxation Labor, social mobility New inventions and development Employment laws Economic recession Lifestyle change Rate of technology transfer Competition regulations Consumer confident for example: the Oxfam shop has many loyalty because of it Education Energy use and costs Safety regulation Inflation rate, when the government wants to reduce it. Fashion, hypes (Change in) Information Technology Political Stability Stage of the business cycle Living conditions (Change in) Internet Employment laws Interest rates Demographics, Population growth rate, Age distribution (Change in) Mobile Technology Five Forces Analysis Porters five forces is a framework for the industry analysis and business strategy development developed by Michael E. Porter of Harvard Business School in 1979. It uses concepts developing Industrial Organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market.(en.wikipedia.org) Supplier Power The Five Forces The threat of substitute products The existence of products outside of the realm of the common product boundaries increases the propensity of customers to switch to alternatives: Buyer propensity to substitute Relative price performance of substitutes Buyer switching costs Perceived level of product differentiation Number of substitute product available in the market The threat of the entry of new competitors Profitable markets that yield high returns will draw firms. This results in many new entrants, which will effectively decrease profitability. Unless the entry of new firms can be blocked by incumbents, the profit rate will fall towards a competitive level (perfect competition). The existence of barriers to entry (patents, rights, etc.) Economies of product differences Brand equity Switching costs or sunk costs Capital requirements Access to distribution Customer loyalty to established brands Absolute cost advantages Learning curve advantages Expected retaliation by incumbents Government policies The intensity of competitive rivalry For most industries, the intensity of competitive rivalry is the major determinant of the competitiveness of the industry. Sustainable competitive advantage through improvisation The bargaining power of customers The bargaining power of customers is also described as the market of outputs: the ability of customers to put the firm under pressure, which also affects the customers sensitivity to price changes. Buyer concentration to firm concentration ratio Degree of dependency upon existing channels of distribution Bargaining leverage, particularly in industries with high fixed costs Buyer volume Buyer switching costs relative to firm switching costs Buyer information availability Ability to backward integrate Availability of existing substitute products Buyer price sensitivity Differential advantage (uniqueness) of industry products RFM Analysis The bargaining power of suppliers The bargaining power of suppliers is also described as the market of inputs. Suppliers of raw materials, components, labor, and services (such as expertise) to the firm can be a source of power over the firm. Suppliers may refuse to work with the firm, or, e.g., charge excessively high prices for unique resources. Supplier switching costs relative to firm switching costs Degree of differentiation of inputs Presence of substitute inputs Supplier concentration to firm concentration ratio Employee solidarity (e.g., labor unions) Criticisms of the 5 Forces model Porters framework has been challenged by other academics and strategists such as Stewart Neill. Similarly, the likes of Kevin P. Coyne and Somu Subramaniam have stated that three dubious assumptions underlie the five forces: That buyers, competitors, and suppliers are unrelated and do not interact and collude. That the source of value is structural advantage (creating barriers to entry). That uncertainty is low, allowing participants in a market to plan for and respond to competitive behavior. (D) Internal and External influence on organisation SWOT Analysis S (1)Oxfam Fair Trade (OFT) is one of the largest UK fair trade organisations(Oxfam as a whole) (2)Oxfam is now moving towards a broader market access programme. (3)Oxfam bookshop where I work has a good reputation among the customers and neighbours, because Oxfam as a whole was founded in 1948, so everyone wants to join it as volunteer, customer and donator. Cheaper and quality and tidy (4)This shop has a strong brand name, because the donators donate evaluated things and they get donations from strong brand companies. (5)The shops location is fantastic, it is neighbour to Rathmines College and it locates among Dublin 6s town amenities. (7)The atmosphere in the shop is attractive. (8)OFT has been very active in capacity building activities. This has led to new skills and greater access to international markets, created by fair trade organisation. W Lack of patent protection Lack of marketing expertise, because of them are volunteer, few of them well-educated, the other lack of expertise. The goods in the shop depend on the donations, sometime there is no donations so the shop lack of goods then lack of costumers. Lack of Creativity / ability to develop new products. Oxfam aims to work with disadvantaged poor producers, typically from the informal sector, which is characterised by low wages, poor social benefits, lack of access to investment and credit and consequent poor working conditions, home-working etc. O T (1)Unfulfilled customers need (1)There are many charity competitors around the shop (2) Arrival of new technologies, for example: in Oxfam shop, the customer takes long time when he/she wants to pay cash, the shop has old-fashion Till (2) Price wars in those competitors (3)New regulations (3)Loosing of regulation (4)Increase trade barriers (4)Removal of international trade barriers (5)Technological developments may make the shops offerings obsolete. Market changes may result from the changes in the customer needs, competitorsmoves, or demographic shifts. The political situation determines government policy and taxation (5) Market led by a weak competitors Value Chain Analysis (Value Chain Analysis describes the activities that take place in a business and relates them to an analysis of the competitive strength of the business. Influential work by Michael Porter suggested that the activities of a business could be grouped under two headings: Primary Activities those that are directly concerned with creating and delivering a product (e.g. component assembly); and Secondary Activities, which whilst they are not directly involved in production, may increase effectiveness or efficiency (e.g. human resource management). It is rare for a business to undertake all primary and support activities. Value Chain Analysis is one way of identifying which activities are best undertaken by a business and which are best provided by others (out sourced) (http:tutor2u.net/business/strategy/value_chain_analysis.htm). Linking Value Chain Analysis to Competitive Advantage (What activities a business undertakes is directly linked to achieving competitive advantage. For example, a business which wishes to outperform its competitors through differentiating itself through higher quality will have to perform its value chain activities better than the opposition. By contrast, a strategy based on seeking cost leadership will require a reduction in the costs associated with the value chain activities, or a reduction in the total amount of resources used).(http:tutor2.net/business/strategy/value_chain_analysis.htm) Value Chain Analysis has two basic activities Primary Activities (Inbound logistics, goods or donations from the public of the shop being obtained from the shop suppliers ready to be used for producing the end product). (Notes given in the class). Operation, the raw materials and goods obtained are manufactured into the final product. Value added to the product at the stage as it moves through the production line. Outbound logistics, once the product have been manufactured they are ready to be distribute to distribution centres, wholesales, retailer or customers.)(Notes given the class). Marketing and Sales, Essentially an information activity informing buyers and consumers about products and services (benefits, use, price etc.) Service All those activities associated with maintaining product performance. (2) Secondary Activities Procurement, his concerns how resources are acquired for a business (e.g. sourcing and negotiating with materials suppliers) Human Resource Management, Those activities concerned with recruiting, developing, motivating and rewarding the workforce of a business. Technology Development, Activities concerned with managing information processing and the development and protection of knowledge in a business