Management Term Paper On Collaborative Strategic Sourcing

Collaborative Strategic Sourcing
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Introduction
Customers are not only limited to the persons that come to a business premises, place orders on the phone or even through the online portals. The term customers also include the persons that make the company operations a success on a daily basis. While the external customer will buy goods and services from the organization, the internal customer on the other hand is one that relies on the assistance of another to fulfil their duties for the organization (Earl, 2017). These are duties that could range from marketing, sales accounting and engineering among others. For example, a sales representative who need assistance from a customer services representative at the company to be in a position to place an order for a client, is considered an internal customer (Earl, 2017). While the internal customers do not need to buy any products or services from the company, they have a very subtle role in the success of the company. More importantly, it is common for the business owners to take more interest in the external customers and neglect the role that the internal customers have on the business. It is important to note that, businesses that focus on their internal customers tend to have better relations with their externa customers. This is relative to the fact that the internal customers are the backbone of the company. Any of the policies that have to be implemented at any given time have to be through the internal customers. As such, giving them, the appropriate attention is thus an essential element of the enhancing the business processes and by extension the success of the company (Gopal, 2015). This is mostly the case when it is considered under the strategic processes of management. It is important for managers to make sure that they have the right attention to the business process, when considering the internal customers. Ideally, it is the internal customers that are going to be interacting with the strategic processes that are developed within the company. The success or the failure of the processes is dependent on the readiness of the internal customers and their commitment to implement the same at any given time and stage of the processes. Strategic processes are associated with long term plans and may span from three to five years. As such, managers have to make sure that they have their teams ready to take up the changes towards the established goals. Like the name suggests, the strategies have to be broken down into strategic steps. There is a chronological approach associated with the strategies, from the time the goals are identified to the time that they are implemented. Throughout all the processes, the managers have to make sure they are able to achieve better performance by the end of the entire process. This paper analyses how the management can involve the internal customers in the strategic processes within the different aspects of the company such as accounting, finance, marketing, engineering, manufacturing among others to make the best improvement in the performance scales.
The Customer
Most of the businesses will concentrate on the customers that come to the enterprises physically, visit the online portals or even make orders from their phone lines. This is relative to the fact that, traditionally, customers buying products and services from a business have been the focal point of any business. The ability to attract and maintain the highest number of customers coming to buy goods and services has been a main aim of most of the companies. This is tied to the core element of making profits, as the main goal for most of the businesses (Earl, 2017). As such, even the vast amount of the research material available it focused on the ability of the firms to attract the external customers at the expense of the internal customers. Recently, however, there has been a spike in the number of research material available on the internal customers. Businesses are starting to take heed of the fact that, internal customers are actually the focal point that matters. Where the employees at the company feel that they are appreciated and that their inputs are acknowledged, they tend to work with diligence and this improves their interactions with the external customers. If the staff at any company are not happy with their working environment or even the organizational culture associated with it, they are likely to pass this on to the clients. This then affects the loyalty of the external customers leading to lower sales ad ultimate collapse of the business from a defective model. This paints a picture of a domino effect associated with not taking good care and the right attention to the staff on a company. Companies that put much of their efforts into making sure that their external customers are served right, tend to neglect the internal customers which in effect affects the ability of the company to serve the external customers. This is a paradox that most of the managers in the past and even today did not have the answers for. As such, they would use the approach in their organizational culture that would mean that, most of the efforts would go into helping the external customers while neglecting the internal customers.
This is also an aspect that can be explained by the fact that, most of the companies have in the past used the hierarchical structure which meant that most of the decisions would come from the top management. These would then be passed down to the rest of the lower management levels and then to the staff to implement. Ideally, none of the internal customers were able to change the course of the decisions that were made by the top management, leave along the middle management (Earl, 2017). As a result, most of the staff at the company would experience unfulfilled working conditions, as they struggle with getting the management to consider other channels of the decision-making process. Using the hierarchical approach, limits the chances of the company management to use innovative skills that rest with the staff and even with the middle management who are in closer proximities with the staff and more importantly the clients. It is important to incorporate the invaluable information that the staff have with reference to the working conditions and even the elements about the customers that they pick up during their interactions. Using the feedback from the customers, the staffs are able to come up with suggestions that the company can use in the decision-making process, to make sure that the operations of the company are tuned to what the external customers want. More importantly the company is also able to tune their internal approaches to fit in with the insights from the staffs, creating a significantly productive environment for the staff across the various levels of management.
It is more important, when considered under the element of strategic management of the various business processes. Making strategic plans requires that the company has enough and credible information on what changes they would want to implement. This is information that can only come from the staff at the company. Strategic plans are planned to be rolled out in phases, in a given amount of time, to use certain amounts of resources, have some element of responsibility among the staff and more importantly to bring the element of improvement to the performance at the company. To achieve this, the company requires the right amount of information for it to make the best decisions on the appropriate course of action that they need to take (Earl, 2017). This can only be achieved through the staff at the company. As such, the core of a strategic plan’s success rests on the ability of the staff to work together towards a given goal. This can only be achieved if the internal customers are involved in the processes. it also means that the environment within which the internal customers are working is enabling. This way the company is able to not only collect the information that it needs to develop strategic plans, it also has the ability to identify gaps that require strategic plans, make the necessary lists of processes to be refined, acquire or dispatch the relevant resources, implement and even evaluate the progress along the way. As such, the important of the staff at the company cannot be understated.
Internal customers
To better understand how the internal customers can be involved in the strategic processes management, it is crucial to first understand who are the internal customers. By simple definition an internal customer a party within the organization who depends on anyone else in the organization. This means that an internal customer may not always be as such, given that they may change their position from time to time. They could be coming to the company because they depend on a given person at a certain time for a specific reason and this could once, twice a week or even yearly (Earl, 2017). As such, their time the internal customer is in touch with the company is relative to the operations that they involve in. for example a sales representative may come to the company once a day or less, because they have to interact with the customer care department or even the warehouse over a specific order that have for their customers. This means that they may only interact with the company if they have a customer that requires the goods or the services that the company offers. The other example would be a payroll person, who is always dependent on the managers from the various departments. If the any of the managers is away or they do not come to work in time, they are going to interfere with the ability of the payroll person in delivering their report in time. This means that the payroll person is dependent on the managers making them internal customers (Earl, 2017).
Traditionally as mentions earlier, the company structure has been associated with various layers of management all of which have their own mandate and powers to carry out the same. At the very top is the CEO or the company President followed by the top managers, below who are the middle managers, then the departmental heads among other heads and then the staff at the very bottom. Ideally, it is the staff at the bottom of the chain of command that interact with the customers coming to the company to purchase products and services. As such, the responsibilities trickle down the various levels of management at the company in reference to the structure all the way to the staff interacting directly with the outside customers.
However, there is a twist to the scenario especially relying on the shift in the paradigm. A former president of the Scandinavian Airlines wrote a book in which he explained the need to change away from the traditional approaches. Jan Carlzon in the book Moments of Truth, turned the pyramid of the traditional organizational structure upside down. Doing this, he emphasized on the need to make sure that the element of service was a two-way street. the lower staff were not the only one that were tasked with service to the outside customers, but rather starting with the top management service could then be redefined within the company. The basic premises of his argument in the book was based on the fact that every other person in the company depends on another person. For a company to hold an excellent reputation for service, this can only be achieved if all the staff at the company and the management work together. Everyone within the company is going to have a profound impact on the outside customer, which means that they have to work together with the rest of the staff to make the experiences positive. Companies that have forged proper internal relations among their staff, always find it easier to attract and maintain their outside customers. This is in light of the fact that, they are able to support one another in delivering the best services to their clients as possible. As such it is the interaction between the various persons within the company that creates the internal customer. There is not an employee at any company that does not require the assistance of another, or whose mandate does not require the interactions with the rest of the staff. This is the case regardless of the level of management or even the mandate that the person holds. Even the CEO requires the assistance of the lower managers.
‘The external customer is someone who signs a check, pays our employer, and ultimately makes our paycheck possible. External customers have choice, and if they don't like your product or service can take their business elsewhere. An internal customer or internal service provider can be anyone in the organization. An internal customer can be a co-worker, another department, or a distributor who depends upon us to provide products or services which in turn are utilized to create a deliverable for the external customer. In general, internal customers don't have a choice. For example, if the sales department doesn't like accounting's credit policies, they can't fire that department and hire another. Great (external) customer service creates customer satisfaction, customer loyalty, and customer retention. So why all the fuss about internal customers, especially when retention isn't an issue? Outstanding internal customer service is simply good business. Internal customer service can flourish only in high communication environment. To create positive internal customer service, all departments work together cooperatively, agree on processes and procedures, and negotiate expectations. Like gears meshing in sync, interdependent business units meet each other’s needs, work productively together to meet common goals, and deliver high quality products and service to the external customer. The focus on developing effective internal customer service helps organizations cut costs, increase productivity, improve interdepartmental communication and cooperation, boost employee morale, align goals, harmonize processes and procedures, replace interdepartmental competition with interdepartmental cooperation and deliver better service to the external customer. Excellent service to the external customer is dependent upon healthy internal customer service practices.’ (Earl, 2017).
As Donna points out, the external customer has the choice of looking for another company and buying from them. The internal customer on the other hand is more rigid. This is relative the fact that they bound by the company policies and structure within which they have to work with. Ideally, the internal customer is not just a person, as Donna indicates (Earl, 2017). This could be a co-worker or even a department. In such light, it is important to note that, if the sale department was not happy with the way the manufacturing department was handling certain aspects of the product, they cannot simply abandon them and move to the next department to get the services. They have to work with the policies at the company. It could be taken that, since the rate of retention of the internal customer is higher than that of the external customer, it is always relevant to dedicate much resources to the same. Traditionally most of the companies have focused on the external customer leaving out the most important part of the company, the internal customer (Earl, 2017).
With quality communication structures and protocol, a company is able to establish a plain field, where they can achieve fluid interactions between the internal customers and thus the external customers. To create a positive internal customer service, all the departments and the staff have to work together, they have to agree on the various processes, negotiate on the expectations and agree on the various procedures. Working on the refinement between the internal customers helps a company to better focus on their needs and how best they can streamline the operations and more importantly to effectively increase the chances of success in reference to the strategic plans laid out by the management. By improving the internal customer services a company is able to bring about a revolution on cutting down the costs, increase the level of cooperation between the customers, increase the level of communication between the various departments at a company, boost the level of morale among the employees, harmonize the procedures and processes, align the goals of the company with those of the employees, other than departmental competitions, these are replaced with interdepartmental cooperation which results in better services to the external customers. It is important to note that, to achieve highly effective service to the external customers, there must be a healthy internal environment. As such, companies ought to make sure that the internal customers have a well-established internal environment.
Strategic Processes Management
Every other company will have some element of plans that they would want to roll out in a number of phases within a given time. These are plans that touch on a number of areas such as customer care, finances, accounting, marketing, procurement and sale among others. Strategic management is associated with managers conceiving and i...