Decide which competitive advantages Riordan has in common with the companies researched last week, and estimate which competitive strategies Riordan could use to improve innovation and sustainability of business operations both in the United States and in the global market.
Last week our group researched and discussed two companies that have many competitive advantages in common with Riordan Manufacturing. After discussing, we decided that the commonalities could all be related to one of three main advantages. Theses advantages are:
1. Being an industry leader – Riordan is an industry leader in the field of polymer materials solutions and polymer materials research, development and patent licensing. Southwest Airlines and Chevron Corporation both are leaders in their respective fields of transportation and oil/energy. 2. Operational Excellence – Riordan Manufacturing employs detailed process systems and standards to ensure operational excellence across all departments. A couple of the key systems used are Six Sigma, and ISO 9000.
Southwest and Chevron both use variations of the Six Sigma process. Southwest primarily in terms of conveyor/baggage handling processes and Chevron in terms of fuel refining and oil plant operations. Both Chevron and Southwest are certified in compliance with ISO 9000 standards. 3. Customer Service and Quality – Riordan strives to be a solution provider for its customer’s needs. The company has a long term relationship focus which drives it to rigorously control quality, provide innovative solutions, have reasonable pricing and provide responsive customer service solutions.
Southwest and Chevron both aim to retain customers through good service and quality product offerings. Southwest also leverages its ability to provide low-price fairs and a good customer experience. Based on where Riordan Manufacturing’s strengths are, we have determined that the following competitive strategies should be used to improve innovation and sustainability of Riordan’s U.S. and global operations. 1. Developing Best HR and Hiring Practices
2. R&D of New Product Lines3. Operational EfficiencyExplain why you chose these competitive strategies and estimate how they might affect sustainability of long-term organizational performance. It is vitally important for any organization to hire the best candidates for their company. “The hiring approach or strategy is imperative to any organization seeking to dominate or sustain themselves with-in their market-place.” (Sullivan, Dr. John, July, 25, 2011).
One specific function Riordan uses to attract and maintain the best qualified candidate is; their “Compensation Philosophy/strategy. Riordan’s Human Resource Department conducts external environmental scans to determine the median pay. Hire the desired employee’s at median, yet competitive wages. Orchestrate a collaboration of employee’s to assemble teams, and compensate/reward according to innovations, ideas, achievements, etc. This approach encourages/motivates teamwork, which make Riordan a close net company, and also “allow for considerable flexibility in rewarding individual performers based on their specific skills and contributions.” (Virtual Organization, Apollo Group, 2011).
Increasing research and development can contribute to innovation and sustainability of business globally and in the U.S. in many ways. Increasing R&D companies can stay ahead of competitors by consistent new products, superior customer service, improved delivery times, and improved strategies to keep ahead of competition. Having each of these areas running efficiently increases innovation and will promote sustainability for any company.
Increasing the efficiency of production, logistics, and customer service can improve innovation and business sustainability without decreasing quality in several ways. Improving the production processes can decrease the cost of production by reducing waste of both materials and time. Improvement in logistics can save the company money on material stored, improve the speed in which materials are received, put away, picked, and shipped.
Making the logistics process more efficient gets the product to the customer correct and on time, reducing their need to contact customer service. Customer service is an area every company needs to evaluate and improve in order to make it more efficient. Many companies try to improve customer service by having a computer answer the phone and handle customer issues or transfer them to the correct department. For some companies this has made their customer service more efficient, for others it has failed. Improving the efficiency of each of these areas will cut a lot of wasted time, and costs, while improving the way customers feel when they have to contact customer service. Explain how the global market would affect the business strategy of Riordan.
In our previous team assignments, we learned how global markets affected business strategies. Joint Venture was a strategy discussed concerning how to enter the global market. Therefore, it was interesting to learn that Riordan used the joint venture strategy to enter the market in China. Organizations use different strategies to monitor the progress/success of their business. Companies have to constantly re-invent themselves to survive their business industry. Riordan has to continue to be innovative in every department. Most would think innovation, or restructuring ideas are developed only in the Engineering, R&D, Production departments.
However, on the contrary, the parents of the company has to keep their eyes on all of their children (all of the departments of the company), looking for ways to improve the departments. A cost/benefit analysis was conducted on Riordan’s global operations in China. Subsequently the managers of the China operations realized it would save the company substantially by changing the logistics of their operations in China. Therefore, they moved the China facility closer to the Shanghai port where the products were shipped to their destinations. The move deleted additional logistic steps, which saved the company costs.
ReferencesApollo Group, A. (2011). Virtual Organizations/Riordan Manufacturing (5thed.). Phoenix, AZ: Apollo Group. Sullivan, Dr J. (July 25, 2011). The 25 Irrefututable Laws of World-Class Corporate Recruiting. Retrieved from http://ere.net/2011/07/25/the-25-irrefututable-laws-of-world-class-corporate-recruiting