Leading and Managing Assignment 1

 

 

CRITICAL ANALYSIS OF MECHANIMS TO AMBIDEXTERITY  Leading and Managing Organizational Resources

 

 

UNIVERSITY OF BEDFORDSHIRE

STUDENT NAME:

AZIM MOHAMMED

STUDENT ID NUMBER: 1722448

UNIT TITLE: LEADING AND MANAGING ORGANIZATIONAL RESOURCES

UNIT CODE: BSS064-6

UNIT CO-ORDINATOR: DR. PAULINE LOEWENBERGER

 

 

EXECUTIVE SUMMARY

This research paper briefly gives a company overview of MBA Design Partnership. The company overview outlines MBA’s background, services, financial performance, and market or markets of operation. Then, this research discusses ambidexterity, a concept con cept which has become  popular due to increasing market volatility and uncertainty and intense competition. Achieving organizational ambidexterity will contribute to a firm’s steady growth and long-term success and sustainability. Furthermore, an analysis of theoretical perspectives from leadership, lea dership, organizational culture, human resource management, operations management, and finance respectively will be  presented. Next, my research will analyse analyse ambidexterity in relation to the relative perspectives. In conclusion, recommendations will be made to MBA on how to support, enhance and improve ambidexterity within the company.

 

 

Contents 1. 

INTRODUCTION  

2. 

AMBIDEXTERITY  

3. 

MULTI-LEVEL ANALYSIS OF AMBIDEXTERITY  ..................................................................................

6

4. 

THEORETICAL PERSPECTIVES WITHIN THE CONTEXT OF MBA .......................................................

7

LEADERSHIP AND ORGANIZATIONAL CULTURE  ..........................................................................

7

4.2 HUMAN RESOURCE MANAGEMENT ..................................................................................................

8

4.3 FINANCE  ..............................................................................................................................................

9

4.4 OPERATIONS MANAGEMENT  ............................................................................................................

9

4.1 

5.  6. 

CONCLUSION 

................................................................................................................................ 4 ............................................................................................................................... 5

.............................................................................................................................. 10

RECOMMENDATIONS   .....................................................................................................................

10

 

  1.  INTRODUCTION

Founded in 2009 by managing director Neil Scroxton, MBA Design Partnership (MBA) is a small architectural firm which operates in the United Kingdom. MBA is an RIBA and RTPI Chartered Architects and Planning Practice that specialises in designing commercial, industrial and residential spaces. Between 2015 and 2018, the company has grown to 22 full time and part time employees and has demonstrated a net growth despite facing many challenges specifically managing the organization’s resources to adjust to market changes. As a quarter ended March 31, 2018, MBA

achieved a turnover of 48% while gross profit increased from 28.2% to 42%. From 2016 to 2018, MBA’s net profit experienced overall growth from $59,234.00 to $122,926.00. This growth

represents an estimated 207% net increase over a three-year period. While turnover steadily increased from $363,287.00 (2016) to $731,012.00 (2018) thus increasing MBA’s business activities. MBA strives to forge ahead in an immensely competitive and dynamic environment. In developing a competitive advantage, MBA needs to simultaneously balance and manage its exploitative and explorative activities with dexterity. This concept is known as ambidexterity. This research paper seeks to analyse intellectual resources across different levels of MBA to determine how mechanisms can enable ambidexterity within the context of MBA. Firstly, this  paper aims to define ambidexterity and briefly discuss its importance. Then using table 3 of Turner et al. (2013) systematic review, analyse ambidexterity from the respective perspectives: -: leadership, culture, human resource management, operations management, and finance. Then using the multi-level analysis, apply and support the use of ambidexterity within MBA. In conclusion, a summary of how ho w the theoretical perspectives harness ambidexterity within MBA will  be presented along with recommendations on enhancing value to MBA through ambidexterity.

 

  2.  AMBIDEXTERITY

Organizational success and longevity depends on a firm’s ability to exploit its current capabilities while exploring new opportunities. Ambidexterity is the ability of an organization to  pursue two disparate things by engaging in both explorative and exploitative activities with dexterity (Raisch et al., 2009). Turner et al., (2013) argues that the concept of ambidexterity is not a reflection of managerial activity however it reflects organizational capability. Ambidexterity has  become a paradigm in organizational theory as methodologies have been formulated and tested to support its theories. Furthermore, only few organizations have accomplished ambidexterity, so its mechanisms have been explored (Sarkees and Holland 2009 cited in Turner et al., 2013). In fact, managing both activities require an organization to divide its resources and adopt different organizational structures and or systems to align with changes in the external environment (Raisch & Birkinshaw, 2008). For instance, balancing the demands of o f exploitation and exploration (March & Simon 1985 cited in Gibson & Birkinshaw, 2004) and highlighting organizational development of structural systems of managing and innovation (Duncan, 1976 cited in Gibson & Birkinshaw, 2004). Adaptability and alignment are fundamental concepts of ambidexterity. Adaptability is an organization’s ability to adjust to volatile markets by undertaking new opportunities while alignment refers to the coherence of business unit activities (Birkinshaw & Gibson, 2004). Research has shown that an extremely small percentage of businesses continue to operate after 40 years. Technological advancements have rapidly evolved the business climate therefore organizational ambidexterity will allow a firm to develop and exploit new products or services outside of a company’s product or service range while exploiting organizational structures and

 processes to reduce operational ope rational cost thus increasing efficiency, profit and overall organizational long-term growth and success.

 

  3.  MULTI LEVEL ANALYSIS OF AMBIDEXTERITY

Turner et al., (2013) have created a matrix to categorize the mechanisms for ambidexterity, and what organizational resources are used in ambidexterity. Ambidexterity is categorized into three levels of analysis i.e. the organizational, group and individual levels. The organizational level defines ‘ performance,  performance, strategy, structure and operations, the group level defines interactions among teams and social context, and the individual level highlights the managerial role, and leadership behaviour. Each level of analysis is characterized by intellectual resources (IC) which is further sub categorized into organizational capital, social capital and human capital. Organizational capital (OC) is defined by the systems with an organization, social capital (SC) is knowledge k nowledge gained from organizational relationships and interactions, and human capital (HC) is the skills and knowledge that the individual possesses. The table below provides a framework to categorize mechanisms to achieve ambidexterity.

Turner et al., (2013)

 

  4.  THEORETICAL PERSPECTIVES WITHIN THE CONTEXT OF MBA

4.1 LEADERSHIP AND ORGANIZATIONAL CULTURE

MBA’s managing director, Neil Scroxton exhibits the transformational leadership style as is apparent by his mentoring attitude towards junior staff, belief of investing in others and his clear vision of where he intends to carry the company. Yukl (2002) describes the transformational leadership style as the most useful as well as valuable in organizations. Transformational leadership is a method by which the leader can intensify member ’s commitment to a group or organization by changing their motivation to compliment the organization’s process (Yukl 1989). While Burkus (2010) states that transformational leadership enables the leader lead er to create value and a positive influence on team members thus demonstrating motivation, influence, consideration and intellectual stimulation. MBA values it employees as one of its most valuable assets. Its employees assist in continually improving the organization. MBA recruits persons who have open mind sets to understanding, sharing and accomplishing the company ’s vision and values, and are motivated by learning and continuous improvement. MBA believes that exceptional individuals can align themselves to the company’s strategies. In 2015, the company introduced ‘the Why Conversation’; which allows staff to focus on the type of work and clients to achieve organizational success, and in 2017 MBA also launched an initiative ‘Building a Culture of C ontinuous Improvement’ aimed at allowing staff to provide management with feedback, and for management to use feedback in its strategic decision making. Based upon the multi-level categorization of ambidexterity, leadership takes place at an organizational level through using strategic initiatives and it is a component of the HC subcomponent of intellectual resources. With the feedback of team members, management can realign the organization’s assets to better manage explorative and exploitative activities in turn thus improving efficiency and long-term success within an organization. Even though, MBA utilises a transformational leadership style, ambidexterity requires a leader to incorporate different leadership styles (Rosing et al., 2011).

 

 

In addition to developing strategies which enable staff to be engaged en gaged in giving feedback to improve the organization’s short comings, MBA has been awarded a warded that Chamber Business Award in 2017 for its organizational culture which is based on employee training and development. dev elopment. MBA initiated the ‘Building a Culture of Continuous improvement (BCCI) in 2009 to encourage staff to give feedback and engage in problem solving activities to improve MBA. In addition to introducing ‘SMART objectives’  so that staff can align the company’s objectives with the organization’s mission and vision (Chamber Business Awards Commitment to people Development, 2017 pg. 4). Leadership and organizational culture are inextricably linked to ambidexterity. An organizational culture that is conducive to employee development will easily promote explorative and exploitative activities (Crossan et al., 2008). 20 08). It is interesting to note, that as at 31 st March 2018, MBA engaged in research and development of new projects which highlights that the company has been engaging in increased exploratory activities.

4.2 HUMAN RESOURCE MANAGEMENT

Vaswani & Vaswani (2017) define human resource management as a system that maximizes employee performance in relation to an organization’s strategic goals. This aims at improving the individual, group and organizational performance p erformance which results in growth within each area. According to Junni et al., (2015), human resource factors such as employee characteristics, leader’s characteristics and human resource practices and systems s ystems affect ambidexterity. Employee characteristics refer to employees’ educational background, orientation and cognition co gnition (Junni et al., 2015). Stokes et al., (2014) hypothesised that employee enthusiasm influences ambidexterity. Employees with mathematical backgrounds for instance in finance and accounting were less compliant to exploration than employees with marketing, management and human resource management backgrounds. Furthermore, employee industry tenure affects ambidexterity. Employees who spent less time in present industry and non-senior positions produce the most ambidextrous outputs (Amos et al., 200).

 

 

MBA has hired a new director, Chris George as well as increased support staff to 22 employees. With this increase in human capital, the organization should expect to greater efficiency and innovation. Furthermore, individuals themselves will take the initiatives to become more engaged with the organization because an organizational culture that promotes individual creativity, innovation and development.

4.3 FINANCE

A reoccurring theme in organizational organization al literature is that successful firms are ambidex ambidextrous. trous. This  premise is evident based on the success of MBA. MBA is a small architectural services firm firm which has achieved growth and success despite operating op erating during the global recession. MBA achieved increased turnover of 575% despite facing many market challenges. An analysis of the company’s expenditure highlights that £40, 000.00 was spent on site visits so MBA decided to start charging a fee to improve the quality of service to its clients. The £40,000.00 earned accounts for 68% of MBA ’s total profit for year ended 2016. The profit p rofit that MBA generated was reinvested into hiring new staff: - a business developer and technical staff which increased its  premise cost because of utilizing the entire building. This generated increased revenue of £165,000.00 and allowed MBA to implement a new engineering company. It is evident that increasing staff and engaging in research and development and new projects have contributed to the firm’s expansion into new markets such as education, real estate and co construction. nstruction.

4.4 OPERATIONS MANAGEMENT

Operations management entailing organizing and supervising the production and delivery of goods and or services and making necessary improvements for higher profit margins (Heizer et al, 2017; Porter 2009). The role of management is to implement strategies to mitigate organizational risks and challenges thus creating and enhancing organizational value. By implementing that strategy to charge a fee for site visits, MBA was able to earn £40,000.00 which contributed to more than 50% of its net profit (Chamber Business Awards Commitment to people Development, 2017).

 

 

Ambidexterity within operations management takes place at both the group and individual level of the analysis. Management can access human and social capital resources. Within the group, everyone possesses unique skills, abilities and knowledge whereas with social capital, management can access information based on their relationship network.

5.  CONCLUSION

The research presented analysed the concept of ambidexterity and its mechanisms within the MBA Design Partnership. Ambidexterity was briefly defined and then analysed in relation to organizational characteristics of leadership and organizational culture, human resource management, operations management and finance. MBA’s Chamber Business A ward of 2017, Commitment to People Development report illustrates that MBA has taken steps to becoming an ambidextrous ambidex trous organization. The company has adopted a transformational leadership style which enables the leader to intellectually stimulate and motivate the employees to be creative, innovative and critical problem solvers. The company undertook initiatives to encourage employees to give feedback in an open an engaging organizational culture which leads to the exchange of innovative ideas. Furthermore, MBA increased its workforce to 22 employees, a new director and technical staff. In addition, to engaging in research and development and engaging in new projects and entering new markets. Ambidexterity is not a task that is easily accomplished because it is the ability for an organization to explore and exploit an organization ’s intellectual resources, and MBA has demonstrated how the different organizational levels use intellectual resources.

6.  RECOMMENDATIONS

MBA has demonstrated growth in terms of profitability and management and employee interactions and relationships. The company has engaged in new strategies which generated a higher net profit. The growth in profit has enabled the company to branch into markets such as education, construction and real estate.

 

 

MBA’s goal in the next three years is to become an influential architectural firm in London and to reach £1 million in turnover. The company should utilize project management strategies to further implement and achieve organizational ambidexterity. Also, since the firm is seeking to expand and become more known, the company needs to invest in marketing and advertising services to reach a much greater target. Furthermore, the architectural firm can branch into complementary services to expand their current service line such as advisory services, space management, interior designing, civil and structural engineering, construction, graphic design,  branding, landscaping etc.

 

 

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