Analysis of Schick Company

Analysis of Schick CompanyExecutive SummaryThe purpose of this history is to provide a diagnosis analysis of Schick giving the study surfaces that are confronting the play along and the attendant implications for the company.Schick was established in the year 1990 and registered in Southampton as a private limited liability backup following the outcome of the collaborative inquiry efforts of ternary university professors namely Prof. Chen Ding, Prof. Karl Otto Ludwig and Prof. Andrew marsh resulting in the design and manufacture of nada saving refrigerators during the period noted for environmental ken and high energy prices among early(a)s. Given their technical and engineering background, over time, the bloodline became one of the market drop deaders renowned for its design and environmentally friendly home(a) appliances and enjoy recognition as a 21st Century Role Model in the year 2014 given its unique capability for growth and lucrativeness while setting global s tandards in innovation, incarnate mixer responsibility, and Responsible Leadership.The demise of the three professors in a tragic road accident in Munich marks the end of an era coupled with the eventual management change of Mr. John Marsh Son of Professor Andrew Marsh as the new chief executive officer who introduced changes in the overall structure of the company including the termination of the four management professionals. Within a short period after this failed leadership and mismanagement resulted in a critical bit which brought the company close to struggling for dire survival as its bedevil by challenges confronting it. The realisation of this reality informs the need for profound strategic change, hence the appointment of an independent analysis of current situation.A cursory look and critical evaluation of current conditions revealed a strategic happy chance from the founding owners ethos creating a non-tangent between cheer, resources, and environment because of a major shift in the business objective and strategy from environmental protection and embodied social responsibility to a short-term profit maximization and benevolence leadership style. This has several negative implications both internal and external which range from loss of believability and trust of rung and other stakeholders, lack of strategic investment in the business future day, to cost-cutting that resulted in poor design and product safety standard.Internally, thither is a high-power distance organisation farming and leadership style currently whereby the CEO displays a coercive power that tends to alienate other stakeholders and serve as a barrier to adequate crisis management and the future business of Schick. Consequently, there is the need for a general review of management ethos and strategies to regain its lost credibility and image necessary for the survival of the business.IntroductionThis report is intended to provide an independent diagnosis of the Schick1 issues affecting and to provide a luxuriant evaluation of the fork out and future implications of these on this company. Registered as a private limited business with the head office in Southampton in 1990 to manufacture domestic white goods, Schick has been in successful business for over 25 years and with laurels nationally and internationally for its innovative environmental friendly energy saving products, trustworthy leadership, and incorporate social responsibilities. However, things took a new turn in January 2015 with the demise of the founders in an auto crash and Mr. John Marsh taking over the management of the business. From this stage, Schick started experiencing changes and challenges resulting in its poor image and study because of the shift in strategic management ethos of the business that led to product fire and death incident.Consequently, this report took a detailed analysis of the major issues with the attendant implications for the future survival of Schi ck before the summary conclusion of the main findings which leads to the prospective action required in response to them. lawsuit diagnosis and analysis of implicationsThe examen of Schick home appliances revealed a series of issues that are hereby provided in this abbreviated SWOT Analysis2 below and further discussed in this reportFigure 1 Abbreviated SWOT AnalysisStrengthsGlobal operating platform.Strong brand name.Economies of scale.Strong sustainability focus. (manufacturing in China)Wide range of productsWeaknessesLack of responsible leadership.Short-term profit focus.Poor business strategy in terms of innovation, value and core competencies.Weakening bargaining power over distributors.Lack of corporate social responsibility seek development facility commitment.Negative publicity poor company imageOpportunitiesIncreasing concern and demand for environmental energy saving appliances.Growing Asian market new market in Africa.New acquisitions business alliance.Potential i nventions.Governmental cooperation and potential funding.Growing concern some climate change and investment in fast-growing product categories, e.g. air conditioningThreatsIncreasing competition.Lower return on investment.Economic uncertainty (BREXIT). tighten skilled workforce due to migrationChanges in laws and regulations.Cheap goods from other countries i.e. JapanChange in customer preferences and demandThe crisis in Schick stems from the change of leadership culture and style. This, in turn, brought rough a change of the companys management ethos and style as the business now focuses on short-term profit maximization strategy finished cost reduction and undermines major consideration for other stakeholders. This manifested in a decision to eliminate staff training and development programme, reduce funding for the research and development unit of the business which stands at the heart of the business future strategic investment absence of which leads to the assay of innovati on, and development that would further grow the business and increase profit (Koch, 2010). To put this in the context of profit maximization, a scholar states that To argue that all firms aim to do nothing else but increase profits has not better basis in logic or intuition as to argue that all students aim only to maximise examination marks (Hawkins, 1970, pp. 129-140). In other words, it is not ideal to focus on profit maximization especially within a short span of time. circumspection style adopted by the Mr. John Marsh is akin to autocratic leadership style associated with rigid control and top-down decision making characterised by hierarchical organisation structure (Schein, 2004 Whetton, Cameron, 2016) whereby the leader makes most important business decisions without the input of his employees. (Enderle, 2009 Northouse, 2016). Efficient decision making is of great benefit especially when importunity is required. But autocratic leaders tend to reduce the morale of his staff and very quickly begun alienating both the directors and employees of the company (Lewin, et al 1939 Cook, 2008). This was compounded by the news of the Schick directors termination which caused a widespread shock, concern, and unrest. This is further reflected the organisational culture best described as power culture (Hardy 1978 cited by Hughes, M 2010), with Mr. John Marsh at the centre of powerFrom the above, it can be stated that the psychological contract Schick and its employees has been damaged and undermine their sense of individual autonomy particularly among Munich staff when given the news of the proposed cuts in research development laboratory as well as training and development that not only give live for social interaction but knowledge exchange that leads to safe innovative product design that contributed the make the company an household name for silk, efficient, safe and trusty product that creates a background for the business profitability. (Mone, London, 201 0 Abdoli, Pourkazemi, 2012).Equally of note is the United Kingdom European Union membership referendum, also known as the Brexit referendum, which took station on Thursday 23 June 2016. This is a critical moment for Schick given all the uncertainty and forms surrounding exit (Global Counsel October 2015) compound matters, as about 50% of the employees in Southampton were of Polish origin, majority of these Polish staffs are concern that they would not make up a future at Schick the Brexit situation and employee naming issues in the company particularly the termination of the four director which they reasoning that if Mr. John Marsh could sack the directors who had help build the company, he certainly could do similar to them as well and as such could not be trusted to protect their interest as employees in the event of changes imposed following the formalization of Brexit. (The Guardian July August 2016). In turn, this creates skills gap and further made worse by Mr. John Mar sh management decision to do away with the usable arrangement in China that gives the business access to the Asian market. The Chinese manufacturer which had established its own market, reputation and distribution channels in Asia was every bit concerned about the impact of Mr. John Marshs leadership on its profitability. By 15th July 2016, the agreement was reached limiting Schicks operations to only Southampton and focused on the UK and Union European market, now apparently more difficult given the UK exiting the common European Union market and without a research development unit (Lorca, Garca-Diez, 2004). The situation at Schick combined with the uncertainty in the UK, the weak pound sterling could increase the companys production cost and reduce its profit margin (Lorenczik, et al. 2016).Regarding its customers, the situation could be likened to that implicit contract that is akin to the employee psychological contract mentioned earlier that was damaged by Schick by not me eting norms, and value expectations given the fact that the company was synonymous with global standards setting in product quality and corporate social responsibility has been badly affected by the attempt to stimulate sales and regain lost credibility in the marketplace, which made Mr. John Marsh used a previous design for washing machines discarded by the research development laboratory in 2015 and the attendance fire and death. This accident event effect was poorly managed (Varadarajan, et al 2006 Carroll, 2013). In addition, Schicks main distributor responsible for the distribution of the faulty washing machine which caused the fire had to terminate its contract with Schick following the negative publicity and the poor management of the situation by Schick. The company option, therefore, could have been to take action in recalling the affected products and make press statement to express regret over the incident and give reassurance of its total commitment to the corporate et hos safety reliability that would demonstrate good communication, business ethics and values in consideration of corporate social responsibility that could help restore stakeholders self-assertion and loyalty (Daly Moloney, 2004 Le, et all 2014). The future of the business is not sure if Schicks narrow market focus is considered as the Brexit could restrict access to northern Europe. But there is growing market demand for white goods in Africa (KPMG, 2016) if connection with china could be re-established and adequate funding provided for research and development.In order to address the issue of staff trust and loyalty, as all staff felt unable to carry on working for Schick given recent events which will also lead to skills shortage and loss of competitive advantage, there is the great need for corporate culture and leadership style. Since staff only remained at Schick due to the memory of the three professors and all they had achieved, there is a need to build on this loyal senti ment through a robust employee involvement as it were to increase employee engagement and participation (Hyman, Mason, 1995).In summary, Schicks established reputation for sleek, modern, innovative energy-saving white goods achieved through a devotion to research development, corporate social responsibility, and responsible leadership, has fallen from grace in short time under the management of Mr. John Marsh bringing about the following challenges. The sacking of the directors created a leadership gap and caused toilsome concern amongst employees and other key stakeholders. The sale of its research development Laboratory had not only compromised Schicks innovative capability but placed customers at risk and reduce it comparative degree competitive advantage as a market leader. The leadership style and short term profit focused approach to business led to the loss of confidence in Schicks leadership both within Schick and in the marketplace. Schick experienced high staff turnov er at over a short period of time which created major gaps in knowledge and expertise. The well-publicised fire caused by Schicks new washing machine has seriously ruined its image and reputation in the marketplace resulting in its main distributor terminating its contract, these created a strategic drift and a situation of lost organisation with environmental and resource value tangent (Kew Stredwick, 2008).ConclusionThe good old Schick is now confronted with enormous challenges and crisis breaking point. Diagnosis exposed the major issues affecting it which need urgent attention for its future business existence consequently, the need to revisit and change the narrow business strategy of short-term profit maximisation, high-power distance structure to furnish considerations for other stakeholders interest with regard for corporate social responsibility, good business ethics and responsible leadership all of which call for immediate action plan and implementation to ensure the su rvival of the company.1 All information relating to Schick in this report and not stated otherwise are drawn from Sockalingam, S (2016) Distressing times at Schick home appliances. Unpublished coursework case study, Glasgow Caledonian University.2The information provided in the abbreviated SWOT Analysis (figure 1) is drawn from the Appendices. Full SWOT Analysis, PESTLE Analysis, stakeholder Analysis, Cultural Web, and Porters five forces of comparative position model respectively.