Research Analysis On How Organizations Respond To Uncertainty

Introduction:

Commonly organizations are established with a common goal, that is to earn revenues through there services or products. But they have their own independent targeted goals and procedures to achieve the same. organizations in pursuit of their desired targets, plan and design their procedures, formulate policies and strategies, in consideration of all possible factors that could affect their performance or interfere their operations. However, there are many external influences that have an impact on organizations in a variety of ways (Coates, p. 1, 2012). Whereas, most of the influences are beyond the control of any smartest management, like natural calamities, economies or weather conditions. All such factors are significant threats for disrupting or slowing down operational procedures of any organization.

Organizations needs a vision, mission and strategies.

The aim of an organization of what it wants to be in the long term is its vison, it is the future illustration of the organization that influence its operational procedures to accomplish its mission (Ledlow & Coppola, p. 213, 2014). Organizations plan and implement their procedures to achieve a specific position in future, the same future position is the vision of an organization which is the main compelling factor leading the organization towards its goals.

Whereas, the vision of an organization must be clear to all its stakeholders, they must know the purpose of the organization and their working for the organization. An organization’s vision is elaborated through its mission. A mission is the purpose of an organization which also serves as the guidelines for all the concerns of the organization (Hughes, p. 22, 2014). The purpose of an organization, its future plans and desired position to achieve is conveyed through a mission statement. A mission statement is an inscription highly valued for describing the organization’s purpose of its existence and objectives, it is also a mode of informing organization’s principles and goals to all its stakeholders (Wilson & Hair, p. 145, 2015).

Once the organization is clear with its vision and made clear the same through mission statements, strategies are developed for the accomplishment of its mission. The same are the guidelines and mode of operations that defines the route through which the organization’s mission could be achieved.

Organizational Strategies:

Strategies are the working plan of an organization for accomplishing its mission. Strategies are developed on the basis of accumulated information of the internal and external factors having influence over the organization’s performance or its operations. However, the external elements are highly volatile and may not remain the same as expected. Under such circumstances, maintaining its market position, becomes the major concern for organization’s managers. Management must keep the organization successful and profitable in the present, or else there will be no organization left to enjoy in the future (Drucker, p.14, 1955).

Managers must have a sharp vigil over the external and internal conditions, must be well prepared to counter with any changes in the circumstances, and re-develop their strategies in accordance with the type and level of uncertainty. Commonly organizations adopt four types of strategies to cope with the uncertain conditions.

Minimizing Cost: –

Organization’s financial turnover is greatly affected due to any uncertain condition, as the source of their revenue that is sales may drop, also for evaluating changed market trends and customers preferences, more amount will be spend whereas the operational cost remains the same. Thus, their cost may increase.

Organizations to minimize their cost implement varied techniques like they would cut down their investment of advertising and would only be opting for modes of advertisement that are cost effective like promotion through social media or relying only on one or two modes of advertisement. Postpone any new hiring and training programs, is also a strategy to cut down the cost. Moreover, unnecessary events, or traveling are also restricted. In a worst uncertain condition, which is predicted to last for a longer period, organization may opt for the last option to cut down their cost that laying off some of its employees.

Minimizing Production: –

As long as the uncertainty persists the organization may restrict its production only to the products that are more in demand, and may not introduce any new product. They curtail their operational activities or services to lower their cost, or produce products with modification making the product more alluring for the customers (Alesch, Arendt, Petak, p. 159, 2012). This strategy also minimizes the organization’s investment through saving on production of many of its products.

Delay investment: –

Earlier investments are exposed to multiple options. Organizations utilize their earlier investments in varied venues and events in pursuit of good returns, but all investments made does not guarantee safe or healthy returns. In most occasions, investment may turn to be a loss. Owing to the uncertain conditions, organizations delay their investment until the conditions return to its stable and favorable state. By adopting the strategy of delay investment, organization would be investing only into opportunities with guaranteed returns.

Innovations: –                         

Even uncertain conditions may present opportunities for organizations. It is the competency of the management to recognize the opportunity and make use of it competently. Uncertain conditions also influence the customers choices and preferences, organizations may produce a product that aligns with the customers preferences under the uncertain conditions. Through this strategy organizations are able to maintain their relationship with the customers and support their regular operational procedures. Unless an organization develops creativity, it’s an open question whether it has much of future (Brass 2010).

Covid-19: –

All Businesses across the globe are badly affected due to the current Covid-19 crisis. Many small businesses have seized their operations or minimized their operations, whereas large organization relying on their saving or opting for financial support to sustain their market presence.

In the current scenario managers should only opt for procedures that are cost effective, support organization’s relationship with customers and may create opportunities for the organization when the same crisis is over. As the operational cost is among the major concerns of organizations, managers should outsource their entire production or parts of it to the sources that could minimize their production cost. Also, managers could also plan a merger with their major competitor, by merging, the two organizations could save some of the money that goes into competing with each other (Robin 2013). Secondly, they should involve their organization in any social activity for the betterment of the community, that could be their contribution towards the fight against the current Covid-19 crisis.  For instance, they could convince the community members through social media, placing banners or placing messages on their products, to stay home or take precautions.  Though it might not generate revenues for the organization but it will definitely aid in their organizations promotion which could benefit them once the world overcome the crisis.

Strategy of MUIC: –

Educational institutes are also among the sufferers of Covid-19. Careers of thousands of students are stake due to the current situation.     MUIC should focus on student’s educational career and their learning. The college through implementation strategies of innovation and minimized cost could not only save future of many students but also will enhance their knowledge as well.

As students are unable to attend classes physically, MUIC should cut down their tuition fees for online classes. Also, by adding option of technical skills learning practically online (no additional fees) will add to their skills, and would prepare them for their survival during the learning tenure and even after their graduation as side earning. Same strategies will definitely benefit the students during the current lockdown period.

References:

Alesch, D. J., Arendt, L. A., Petak, W. J (2012) Natural Hazard Mitigation Policy. Springer: USA.

Brass, D 2010, ‘Microsoft’s Creative Destruction’, The New York Times, 4 February, viewed 18 April 2020, https://www.nytimes.com/2010/02/04/opinion/04brass.html

Coates, C. R (2012) Veterinary Practice Management. CABI: USA.

Drucker, P. F (1955) The Practice of Management. Elsevier: USA.

Hughes, M. D (2014) United States Army Third Infantry. Xlibris: USA.

Robin, M 2013, ‘David Jones and Myer slide into irrelevance: why our department stores are failing’, SmartCompany, 19 February, viewed 18 April 2020, https://www.smartcompany.com.au/people-human-resources/managing/david-jones-and-myer-slide-into-irrelevance-why-our-department-stores-are-failing/

Wilson, E. J., Hair, J. F (2015) Proceedings of the 1996 Academy of Marketing Science (AMS) Annual Conference. Springer: USA.