Abstract
In this project, the analysis of structures of the company Hauser & Partner is presented. It is a small-scale family business delivering high-quality installations for various events, shopping malls, and outdoor activities. The first chapter involves the internal analysis using the McKinsey 7-S Framework, and the second chapter consists of strategical analysis using BSC, SWOT, and PESTLE models. The fourth chapter of the project discloses the organizational changes proposed by me if I was the CEO of the business.
Introduction
Within this paper, the company Hauser & Partner is being assessed. This is a small family-owned design/event company with over 40 years of experience and an established name in their line of work. They deliver high-quality installations for (corporate) events, shopping malls, and outdoor. The company suffered from great from the Covid pandemic and had to let go 50% of their staff. Consecutively, one might say that at the moment, the firm is experiencing a tough step-by-step recovery process and might benefit from the appropriate business analysis.
Internal Analysis
Assessment with McKinsey’s 7S Framework
Assessing the company Hauser & Partner based on the McKinsey 7-S Framework provides an insight into how different corporate elements synergize to achieve the company’s goals. These insights can later be utilized to secure a broader understanding of the company’s main successes and failings, as well as the upcoming developmental goals. McKinsey consultants Tom Peters, Robert Waterman, and Julien Philips, with support from Richard Pascale and Anthony G. Athos, created the McKinsey 7-S model in the 1980s. The model has been widely utilized by academics and practitioners since its inception, and it is still one of the most prominent strategic planning tools. It centers on employee skills and attitude as a key to improved organizational performance, rather than the traditional mass production tangibles of capital, infrastructure, and equipment (Ashrafi et al., 2021, p. 14). The model’s objective was to illustrate how the company’s seven aspects, Structure, Strategy, Skills, Staff, Style, Systems, and Shared Values, might be matched to create effective results. The seven aspects are linked, and for a company to run properly, changes in one area necessitate changes in the others.
Structure
Hauser & Partner utilizes the classical functional organizational structure, with communication between departments being the key to the achievement of performance goals. A functional organizational structure is a framework for organizing employees. They are divided into groups depending on their unique abilities and knowledge. Each department is organized vertically, with positions ranging from the president through the finance and sales divisions, customer support, and workers assigned to a single product or service. Specialized units report to a single authority, generally called top management, in functional organizations.
Employees with comparable talents and experiences are placed together, resulting in more efficient and high-quality output. Because roles and responsibilities do not change frequently, there is little time spent acquiring new skills, and responsibility is obvious. Because the structure is basic, employees just have to report to one manager rather than numerous people. This improves communication and eliminates staff misunderstanding, and if everything is standardized, employees may be confident in their work.
Strategy
The company’s strategy is to provide high-quality installations, decorations, and event management services to clients while keeping operational expenses as low as feasible by utilizing freelance staff during busy periods. To achieve the said outcome, Hauser & Partner utilizes the cost leadership strategy that focuses on optimization and financial efficiency. Cost leadership is a strategy for lowering operating costs and producing the lowest-cost products or services in order to outperform competitors and acquire market share. It necessitates a relentless pursuit of cost-cutting strategies such as effective use of scale, sound buying strategy, cutting-edge technology, and high-quality products. Companies may establish a cost leadership plan by assessing current operations, studying rivals, creating cost-cutting initiatives, and tracking success. Companies with the lowest operating costs have a better chance of surviving downtime, which is illustrated by Hauser & Partner beginning to overcome the negative consequences of the COVID-19 pandemic.
Skills
The worldwide event market will be boosted in the following year by changes in the social environment and changes in the standard of organizing events. Furthermore, the global event industry will be driven by the growing demands of modern consumers and companies using the customs of event organizers. Event management is a creative process requiring experienced leaders that implement strategic planning, commitment, and accountability (Pardon and Stone, 2019, p. 927). Naturally, the employees of Hauser & Partner are skilled in these relevant areas of expertise, making them almost irreplaceable in the workplace. Leaders in the company use consultative styles in decision-making and can be described as flexible and adaptive workers using human capital efficiently.
Staff
The sources on Hauser & Partner demonstrate that the company is led by an inexperienced CEO with no proper context for multiple obstacles presented by the competitive market. Leadership flaws are characteristics that a leader may possess that can lead to inappropriate workplace behaviors and relationships. Micromanaging, inconsistency, a lack of awareness, and other comparable characteristics can be ascribed to leadership shortcomings. Having one’s leadership and charisma in deficit is not a good idea, as it may lead to recognition and a route to growth. With regular effort and a desire to learn, leadership shortcomings may be strengthened and developed. Nevertheless, the lack of a distinguished strong hand of a leader is noticeable in a booming but highly competitive industry of interior design.
Style
The leadership in the firm can be put the closest to democratic type, with every member of the team is allowed to participate in the decision-making process. Democratic leadership, also known as participatory leadership or shared leadership, is a kind of management in which group members participate more actively in decision-making. This style of leadership may be seen in a variety of settings, including private enterprises, schools, and government. While the democratic method emphasizes group equality and open exchange of ideas, the group’s leader is nonetheless there to provide direction and control. The democratic leader is in charge of selecting who belongs in the group and who gets to participate in decision-making. The democratic leadership style is one of the most successful, primary to improved production, better contributions from group members, and increased group morale, according to researchers. Judging the size of the company, managerial leadership is the most efficient and creates a cooperative environment between staff teams.
Systems
ERP systematic framework is the pillar of the system field within the company. Business applications have progressed through time from Management Information Systems (MIS) with minimal decision assistance to Corporate Information Systems (CIS) with some decision support for Enterprise Resource Planning (ERP). Enterprise Resource Planning (ERP) is a software solution that addresses an organization’s demands while combining all of the organization’s activities and taking into consideration the process perspective to fulfill the organization’s goals (Ali and Miller, 2017, p. 667). Its goal is to make information flow across all business departments inside the company as simple as possible, as well as to manage the firm’s relationships with external stakeholders. In a word, Enterprise Resource Planning software attempts to combine all of an organization’s many departments and operations into a single computer system to fulfill these departments’ diverse demands.
The assigned task, which is to build a single software application that caters to the demands of the Finance Department, as well as the Human Resource Department and the Warehouse, appears to be unachievable. These many departments generally have their software package that is tailored to their specific needs. Furthermore, if properly implemented, this integrated strategy may save a company a lot of money. Different departments may simply share information and interact with one another using an integrated solution. Hauser & Partner has implemented an ERP system that includes all necessary tools. Furthermore, there is a centralized server structure for data storage and collaboration. All these available tools are monitored by an external IT-Provider that is responsible for their availability 24/7. Hauser & Partner’s ERP system should be updated and transformed into the cloud to have global access and better performance.
Shared Values
As a small business, the company prioritizes the relationships and connections between employees as its core strength. Workplace values are the most important guiding principles for how the company operates. These firmly held beliefs allow businesses to distinguish between the proper and incorrect ways to work, as well as assisting people in making crucial decisions and career choices. These principles form the cornerstone of a company’s culture, which influences each employee’s workweek. It decides whether workers like their employment, are invested in their firm, and want to stay on board. Simply said, a company’s values and the culture it fosters may determine whether it succeeds or fails. According to a Deloitte study, distinct corporate culture is crucial to a company’s success for 94 percent of executives and 88 percent of workers. Employees who claim to feel pleased and appreciated at work are more likely to believe their firm has a good culture, according to the same poll.
Strategical Analysis
Assessment with Balanced Scorecard
The balanced scorecard (BSC) is a strategic management performance indicator that is used to identify and enhance various internal company activities and the external outcomes that flow from them. Balanced scorecards are widely used in the United States, the United Kingdom, Japan, and Europe to measure and offer feedback to businesses. Managers and executives must acquire and evaluate data in order to provide quantifiable outcomes. This information may be used by company personnel to make better decisions for the future of their businesses.
Using a scorecard has several advantages, particularly when navigating a competitive business environment in the long run. The ability to combine information into a single report is one of the most significant benefits, as it may save time, money, and resources. It also helps businesses to track their service and quality performance in addition to their financial data. Companies can also use scorecards to identify and eliminate inefficiencies.
The term “balanced scorecard” refers to the notion of using strategic metrics in addition to standard financial metrics to create a more “balanced” picture of performance. The balanced scorecard idea has progressed beyond the basic usage of viewpoints to become a comprehensive strategic management system (Quesado, Aibar Guzmán, and Lima Rodrigues, 2018, p. 189). A key benefit of using a disciplined framework is that it allows organizations to “connect the dots” between the various components of strategic planning and management, implying that there will be a visible link between the projects and programs that people are working on. The KPIs are used to track success and the strategic objectives that the organization is attempting to achieve.
The BSC typically consists of four intertwined areas of evaluation that form a network together when analyzed in conjunction: learning & growth, business processes, customer perspectives, and financial data. The examination of training and knowledge resources is used to look into learning and growth (Ashrafi et al., 2021, p. 13). This first leg deals with how well data is gathered and how well employees use that data to turn it into a competitive advantage in the industry.
Investigating how successfully things are created helps to evaluate business operations. Any gaps, delays, bottlenecks, shortages, or waste are tracked through operational management. Customer feedback is gathered to determine customer satisfaction with product or service quality, pricing, and availability. Customers offer comments on their current product satisfaction and might therefore provide the management team with indirect but real-time updates. To understand financial performance, financial statistics such as sales, expenditures, and income are employed (Quesado, Aibar Guzmán, and Lima Rodrigues, 2018, p. 189). Dollar quantities, financial ratios, budget variations, and income objectives are examples of financial measures. These four legs cover an organization’s vision and strategy and need active management to examine the data gathered.
Below the Balanced Scorecard performance measures of Hauser & Partner are presented, including financial perspective, internal business perspective, customer perspective, and innovation and learning perspective. The financial goals of the company are to increase shareholder value, sales, and cost-efficiency that can be measured by stock price, revenue, and margins (Table 1).
Table 1. Financial Perspective of Hauser & Partner
From the customer perspective, the company should aim to deliver the best value and improve its reputation among customers. The latter can be measured by surveying the customers to receive their feedback about their perception of the price/quality ratio and recognition of the brand (Table 2).
Table 2. Customer Perspective of Hauser & Partner
Internal business goals include hiring more permanent staff and improving the work environment that can be measured by a number of short-term contracts and employee satisfaction feedback (Table 3).
Table 3. Internal Business Perspective of Hauser & Partner
The innovation and learning perspective includes implementing the performance differentiating the business and increasing leadership knowledge that can be measured by a number of staff and leadership practices relatively (Table 4).
Table 4. Innovation and Learning Perspective of Hauser & Partner
Assessment with SWOT Analysis
Strengths
Hauser & Partner has already determined that small interior design firms have a lot of room to grow because the larger players in the region only control approximately 8% of the company clientele and provide just 27% of the service income, leaving a lot of room for players like Hauser & Partner Hauser & Partner is conducted by someone who has lived in the region for a long time and so is familiar to many of the potential clients. The proprietor is also aware of many of the prospective client’s interests and preferences, allowing him to deliver great customer service. These benefits are further enhanced by the established reputation the company possesses, having worked within the market for over 40 years.
Hauser & Partner can provide very low pricing to its domestic interior design clients since it is a tiny business with minimal overheads, such as maintaining a large team or an outstanding office. In order to obtain an easier entry into the market, the pricing might be maintained relatively low in the initial year. Hauser & Partner has established excellent relationships with local suppliers and merchants, which will be beneficial for sourcing unique product requirements for its clients. The proprietor has a strong eye for interior design and can work with local suppliers to duplicate high-end products at a better price and quality than discounters.
Hauser & Partner interiors may adapt uniquely to the preferences of each customer and so obtain recommendations and create a loyal client list for the future because the initial expenditure has been kept cheap, and the designing will primarily be done by the owner. The lack of a big in-house product also allows the company to cater to the demands of do-it-yourself clients who primarily need assistance in putting their design ideas into action and are hesitant to contact large and established home interior decorators.
Weaknesses
Internally, the firm lacks strong leadership from a man whom the majority can and will trust. The current CEO is an inexperienced individual whose decisions often come off as brash when they are not fully thought true. Consecutively, the brand does not possess a clear mission or vision at the moment since no one n danger has had interacted with the biscuits. Additionally, the company has been experiencing balance-related issues due to the aftermath of the COVId-19.
Opportunities
Because of the influence of urbanized culture throughout the world, where people experience many kinds of cultures such as values, food, festivals, and lifestyles, and work with people of other countries, cultures, and love, the residential sector leads the global Interior Design. The corporate sector is anticipated to be the fastest-growing market, owing to rising concerns about work environments, which have necessitated a greater focus on creating physical spaces and cultures that attract people. By prioritizing innovation and business development, the company would be able to secure the public interest and attention in the long term (Vlados, 2019, p. 356). Importantly, this proposition relies heavily on the established name of the character, whose grandmother, according to him,
Threats
Inadequate technology remains the main threat for the company, undermining its true potential. According to a recently released poll, an overwhelming 90 percent of North American firms claimed it is impossible to acquire a 360-degree view of their consumers without employing several platforms (Ritz, Wolf, and McQuitty, 2019, p. 354). According to the poll conducted by Beagle Research Group and global tech supplier Zoho, companies must realize the relevance of this conclusion since the consumer and client relationship is particularly vulnerable during the epidemic and the environment for communication is crucial.
Workers evaluated technology systems as obsolete and inefficient for overall performance, according to the two firms. While companies succeeded in conventional management, employees assessed technology systems as old and inefficient for overall performance. In a statement, Raju Vegesna, chief evangelist at Zoho, stated that the modern production itself is a result of technological achievement that at some point seemed truly revolutionary. Now digital revolution has replaced the industrial one, and the firms must follow it if their ambition is to remain productive. The inescapable conclusion from this data is that if businesses wish to enhance their performance, they should start with the IT systems that underpin their core business operations.
For the bulk of small company decision-makers, cloud technologies are equally troublesome. Only 8% of respondents say they’ve used cloud computing significantly. Security worries frighten 33% of respondents, while speed and performance difficulties while accessing the cloud frighten 28%. 24 percent are unsure about the advantages of cloud computing, and 21% are apprehensive about getting bound into long-term commitments. The report delves into the relationship that UK SMB executives have with their technology.
The research also reveals a lack of support and flexibility, both of which are critical for fast-growing organizations that want easy-to-manage solutions they can rely on. Cloud services are gaining momentum as a critical component of an SME’s IT infrastructure, particularly for businesses that deal in online or digital marketplaces and need to turn to compute resources on and off to complete client tasks. The summarization of the SWOT analysis is presented in Table 5.
Assessment with PESTLE
Political considerations are important in evaluating the elements that might affect Hauser & Partner’s long-term profitability in a certain region or market. Hauser & Partner is a Swiss company that specializes in event organizations, and it has lately been impacted by the covid-19 limitations (Meyer, Prescott, and Sheng, 2021, p.86). Diversifying the systemic risks of the political environment is necessary to accomplish success in such a dynamic event management sector. Before joining or investing in a market, they might thoroughly examine a variety of variables, such as the political situation within the market and its current relationship with the relevant industry (Nandonde, 2019, p. 57). Relevant bureaucracy and expected levels of corruption are likely to be able to be eligible to be considered for the beta test.
The aggregate demand and aggregate investment in an economy are determined by macroeconomic factors such as inflation rate, savings rate, interest rate, foreign exchange rate, and economic cycle. Microenvironmental variables such as competition standards have an influence on the firm’s competitive advantage. Hauser & Partner can forecast the growth trajectory of not only the sector but also the organization by using the countrys’ economic factors such as growth rate, inflation, and industry economic indicators such as Home Furnishings & Fixtures industry growth rate, consumer spending, and so on. Hauser & Partner Inc. should consider the following economic considerations while performing PESTEL.
A company should also do a technological study of the industry and determine the rate at which technology disrupts it. A slow pace will offer the management team more time, while techno speed will provide them with less of it. However, the factors of recent technological developments within the industry, its impact on the product offering, and the brand’s commitment to cost leadership are not to be discarded.
Varying markets have different norms or environmental requirements, which might have an influence on a company’s profitability. Even within a country, states might have disparate environmental and liability legislation. In the United States, for example, Texas and Florida have distinct responsibility rules in the event of an accident or an environmental disaster. Similarly, several European nations provide beneficial tax advantages to businesses that participate in the renewable energy industry. Before entering new markets or establishing a new operation in an existing market, a company should thoroughly assess the environmental requirements that must be met in those areas (Nandonde, 2019, p.56). Some of the environmental points a management team might incorporate in their work in the future such as waste management and ecologic product offerings.
Recommendations
Communication
The communication in Hauser & Partner is on a high level of trust and cooperation. Leaders provide deep knowledge of using democratic leadership and involving employees in decision-making processes. However, some leaders seem to act intuitively and need additional practices to enlarge acquaintance with leadership management and implement in on practice. Staff proposes innovative ideas and shares their reflections as well as shows loyalty to the company.
Planning
The BSC is used to collect critical information from these four key activities of an organization, including objectives, metrics, initiatives, and goals. Companies can quickly identify obstacles to company success and propose strategic adjustments that will be tracked by future scorecards. When looking at corporate objectives, the scorecard can give information about the organization as a whole. The balanced scorecard approach may be used to execute strategy mapping to determine where value is added inside a company. A BSC may also be used to establish strategic ambitions and goals for a firm.
According to the BSC, Hauser & Partner needs to develop a plan from the financial, customer, inner business perspectives, and innovation and learning practices. The major financial goals are increasing shareholder value, sales, and cost-efficiency. From customers’ interests, the business needs to deliver the best value and improve its reputation by recognition of the brand. The major internal goals are to increase more permanent staff and improve the work environment. Lastly, developing the performance differentiating the business might help the recognition of the brand, and increasing leadership knowledge can enhance staff interrelations. All the BSC goals and measures planning are presented in tables 1, 2, 3, and 4.
Leadership
The first step in transforming leadership flaws into strengths is to identify important areas that require change. For example, one might solicit feedback from your team to assist you in identifying which leadership qualities you need to improve. It might be a micro managerial characteristic or a need for regular status updates. Once one has recognized their major flaws, you can start putting improvement methods in place to assist you in turning those flaws into strengths.
After all, it is appropriate to consider putting in place an improvement plan or a professional growth objective to strive toward. A leader who lacks motivation and drive, for example, can begin by integrating activities and exercises to increase motivation and rekindle a passion for their profession (Hogan et al., 2021, p.212). A team leader who lacks faith in their staff could offer assignments just at the start of the day and ask for reports only after each project is done.
If I was the CEO of Hauser & Partner, I would make the organization of the company more flexible and dynamic. Currently, the business has a complicated hierarchy consisting of the board of directors, CEO, CPO, and COO that are responsible for various branches. However, judging the scale of the company, the complex hierarchy is unnecessary as it reduces the flexibility and speed of the organization’s functioning. The current organizational chart is presented in Figure 1. To simplify the leadership structure, I propose removing the CPO and COO as the number of responsibilities they have are minor and can be controlled by the CEO. The projected management structure is accessible in Figure 1.
Conclusion
To summarize, event organization is a creative and innovative branch of the business field in which customers’ demands are used to construct event installations or management for various companies and private people. The event management business is made up of companies that specialize in the planning, designing, and administration of projects on various event topics. Event organization is one of the fastest-growing occupations in the United States and Europe, with several areas seeing exponential growth. This sphere is usually viewed as a steppingstone to various career opportunities since it gives education and training that may enable a person to find work in almost any field of human management (Zhang and Lu, 2021, p.296).
Consumer demand for event installations, decorations, and theme event management requires a vast number of high-qualified specialists that can plan human recourses and cooperate with employees. In this project, the company Hauser & Partner was analyzed using McKinsey 7-S Framework, Balanced Scorecard, SWOT, and PESTLE. Despite the fact of meeting different struggles during COVID-19 pandemics, Hauser & Partner managed to save the decent interrelations among workers and achieve various business goals. According to McKinsey’s 7-S assessment, the firm lacks a confident and more experienced CEO and the update of the ERP system to achieve better performance. From all other perspectives, the company stays up-to-date and needs maintenance of skills, leadership style, major values, and strategy. According to BSC, the major goals are in the financial sphere: increasing shareholder value, sales, and cost-efficiency. From customers’ interests, the business needs to deliver the best value and improve its reputation by recognition of the brand. Internal goals should focus on enlarging the number of permanent staff and improving the work environment. Lastly, developing the performance differentiating the business might help the recognition of the brand, and increasing leadership knowledge can enhance staff interrelations.
SWOT analysis highlighted the primary strengths, weaknesses, opportunities, and threats of the company that can be viewed in Table 5. PESTLE assessment defined the importance of evaluating the political, economic, social-cultural, technological, legal, and environmental factors before entering new markets or establishing a new operation in an existing market. My recommendations to the further company performance include changes in the organization, including the removal of the COO and CPO to make the management structure more flexible and dynamic. These changes can help increase the speed of the company’s actions and avoid unnecessary bureaucracy.
Reference List
Ali, M. and Miller, L. (2017) ‘ERP system implementation in large enterprises–a systematic literature review’, Journal of Enterprise Information Management, 30(4), pp. 666-692.
Ashrafi, A. et al. (2019) ‘The role of business analytics capabilities in bolstering firms’ agility and performance’, International Journal of Information Management, 47, pp. 1-15.
Hogan, R. et al. (2021) ‘Twenty years on the dark side: six lessons about bad leadership’, Consulting Psychology Journal: Practice and Research, 73(3), pp. 199–213.
Meyer, B.H., Prescott, B. and Sheng, X.S. (2021) ‘The impact of the COVID-19 pandemic on business expectations’, International Journal of Forecasting, 1(1), pp. 79-102,
Nandonde, F.A. (2019) ‘A PESTLE analysis of international retailing in the East African Community’, Global Business and Organizational Excellence, 38(4), pp. 54–61.
Padron, T.C. and Stone, M.J. (2019) ‘Leadership skills in event management courses’, Event Management, 23(6), pp. 927-937.
Quesado, P.R., Aibar Guzmán, B. and Lima Rodrigues, L. (2018) ‘Advantages and contributions in the balanced scorecard implementation’, Intangible capital, 14(1), pp. 186-201.
Ritz, W., Wolf, M. and McQuitty, S. (2019) ‘Digital marketing adoption and success for small businesses: the application of the do-it-yourself and technology acceptance models’, Journal of Research in interactive Marketing, 13(2), pp. 179-203.
Vlados, C. (2019) ‘On a correlative and evolutionary SWOT analysis’, Journal of Strategy and Management, 12(3), pp. 347-363.
Zhang H. and Lu Y. (2021) ‘Application and development prospect of virtual reality technology in interior soft decoration design industry. In Abawajy J., Xu Z., Atiquzzaman M. and Zhang X. (eds.) Advances in Intelligent Systems and Computing: Springer.