Issues And Causes Of The Problems In Maritime Safety Industry

Discuss about the Issues And Causes Of The Problems In Maritime Safety Industry.

The issue in hand deals with the problems faced by a private sector organisation which was involved in the maritime safety industry. The said company operated in the maritime safety industry and it provided a number of services on a global scale to a variety of different organisation around the world. The issue had arrived only when the company faced a point a point of inflexion, after providing faithful and dedicated service to a number of their clients across a span of thirty to forty years in the field of maritime safety industry.  Till a period of thirty to forty years, the company had provided a wide range of services to its clients and customers. As a result of which, the clients of the company had unrestrained faith over the different kinds of services which had been provided by the company to them. The clients were very satisfied with the kind of consistent service provided by them and thus, they had developed a solid reputation in the market and its brand had garnered significant amount of success. Lately, the company had realised that the company’s performance policies could become banal in the long run, if they fail to infuse a fresh set of policies and rejuvenate their way of performing. Thus, the company’s management had shifted gears and had identified three inflection points, but was confused as to which path to take. On the other hand, the competitors were growing by leaps and bounds Schwartz and Mark, 2013). Thus they needed an independent assessment in this regard by an expert consultant, to help them out.

The background of the issue played a significant role in management’s recognition of the problems and the dilemma of selecting the appropriate path to tread on. The company had provided top notch services for almost a period of thirty to forty years in the field of maritime security. When the  management realised that the competitors’ internal rate of return, they came to the conclusion, that there is a serious trouble as, if the trend continues, them the competitors ‘s internal rate of return would comprehensively surpass theirs. They undertook to transform their organisation and came to three different inflection points. These different inflection points had become their cause of concern. Consequently, they wanted to stop this transformation process and again restart the same. This lead to a string of problems for the company in terms of regulatory problems, financial problems and even the risk of losing the reputation, it had gathered over the years. More importantly, the risk of losing the sustainability of the services provided by them was at stake. This would impact the Maritime Safety and they realised that the process and the structure, must be abandoned at the earliest. Thus, the immediate assessment and assistance of an expert in was required.

Issue background

The issue had cropped up due to a number of important reasons, which had the capability of derailing the company from its track of sustained economic and all round success.  The primary and the most significant reason behind this problem is the failure of the organisation in having an independent and separate perspective on the success path for initiating and completing a complete transformation.

Moreover, the company had very little independent oversight on the actual transformation process. Along with this, there the organisational capability which was missing and was not verified on an independent basis. As has been mentioned above, the company was quite successful in the Maritime Safety industry and it was running quiet well. As a result of which, there was absence of any desire or the need to change the way the company was operating (Martinez et al., 2014). The company was running successfully, and they had felt that there was no need to undertake any kind of elaborate steps to make the company ready for the future changes, that might occur in due time.  They were under the impression that the company was running successfully in its traditional procedures, as a result of which, even if the management had undertaken to perform a transformation, there was no fixed date or tenure by which this transformation would be complete.

• A comprehensive SWOT analysis: Even if the competitor of a company, has better products, or even if it is selling at a low price. Every company has certain weaknesses, which could be used to outperform them. As a result which, a complete and authentic SWOT analysis of the competitors is necessary (Vachon et al., 2013). This would help in assessing the various strengths, weaknesses, opportunities’ and threats of the company.
• Enhancement of the IRR: The Internal Rate of Return is one of the most important of tools which is used to assess the returns expected out of investing in a certain of project. There is no certain way of enhancing the internal rate of return of the company (Heizer, 2016). However, the company must conduct proper capital budgeting through the internal rate of return of the various investments and projects undertaken.
• Improving organisation’s capabilities: The improvement in the organisational capabilities can be done through many ways, two prominent ones are lean management and talent operations. Lean management seeks to eliminate any kind of time, money or effort wastage by recognising each and every business step and reducing the steps which are completely unnecessary (Gnoni et al., 2013). Talent operations is another significant aspect of recruitment and if done properly, then it may provide a competitive advantage to the company involved.
• Root cause analysis: A root cause is a factor which has caused a significant amount of downfall in any company’s performance and thus needs to be eliminated at the earliest possible time. It involves initially discovering the symptoms of the problem faced by the company, recognition of the first level causes, thirdly discovering the higher level causes (Black, Norman and Vernetti, 2015). The discovery of the root causes of the problems is one of the most efficient ways of identifying the problems. This will go a long way in assessing the problems faced by the organisation.

The company has been facing a series of major problems and it has systematically failed to recognise each of them. This is because the company was running successfully in accordance with its traditional principles. Now when the competitors’ rate of return is running ahead of the company’s and a string of problems like financial loss, reputational loss are creeping in, the company faces an insurmountable danger of being wiped out in the long run. In this case, a series of solution alternatives have been mentioned, which will be discussed shortly. Firstly, it is advised that the company must conduct a thorough SWOT analysis of itself, in order to chalk out all the internal as well as the external intricacies. Secondly, the company must aim to improve the rate of return, therefore must encourage its management to assess the internal rate of return of each of the projects before embarking on the process of undertaking them. Thirdly, the company must focus on the undertaking lean management and talent operations (Frost et al., 2014). Each of these two would help the company in saving of time and money, as it aims to keep only the valuable employees in the company and offload the inefficient ones. Fourthly, the company must focus on undertaking a comprehensive root cause analysis on different problems faced by the company. The ineffectiveness of the transformation process of the company must be looked into by a robust root cause analysis. If all these points are taken care of, then the company would be able to get back to its best and effectively serve its clients and customers.

Causes of the issues

Each and every aspect of any business venture has an ethical consideration attached to it, which presents an ethical dilemma for its implementation. The application of the alternatives, in the same way has some ethical dilemmas attached to it. If properly analysed, it could be seen that due to the lean management operations, the loyal employees would be ousted out in the wake of new and efficient employees hired by the employees. The company would want to keep the efficient employees but the loyal employees who are under performing would need to be fired. This presents an ethical dilemma for the company. Similarly, the company would need to conduct a thorough root cause analysis for the problems faced by it, which would require some help from the outside professionals too, apart from the management. This presents an ethical dilemma too, as the management would feel that they have not performed well, which has caused them to overlook these crucial problems, which is now being looked onto by the outside professionals.

The company must have a proper and effective implementation procedure in place for the smooth application of all these alternatives. Effective involvement of the management of the company is necessary, right from the CEO of the company to the other executives of the board, everyone should be involved in the very heart of the implementation process. Be it the root cause analysis, the internal rate of return, lean management or talent operations or even the SWOT analysis, active involvement of the management is imperative. Separate division must be made, under the direct leadership of the CEO, which would actively look into the entire solution procedure. Any deviations or problems would be immediately reported to the top management or the CEO. The major implications of this would be an increase in the expenditure of the implementation procedures of the company. The creation of separate division, hiring of experts for conducting the root cause analysis, lean management and talent operations would put some pressure on the financial front of the company. If all these alternatives are properly implemented, then the company would be able to solve the inherent problems which has existed for such a long period of time.

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