KJR Construction: PESTEL And SWOT Essay, Opportunities, And Threats.

PESTEL Analysis

KJR construction is a Singapore-based construction and engineering company having a business interest in the field of manufacturing, engineering, and construction services. The company is also registered in the top ten construction firms. The company is founded in 1975 by Mike Daniel and Baron Daniel which serve their services across the world (Sun, 2021). The construction services provided by the company are transportation infrastructure, buildings, factories, and water treatment plants. The manufacturing services include having engineering, electronics, and electrical systems, mining, and construction industry.

Political factors: Political factors of KJR construction include the level of political stability, laws of the country, level of taxation. It is important for KJR construction to study current trends in the country's political scenario as changes in government may change the government priorities towards the development of different industries.

Economic factors: Economic factors of KJR construction includes the Current economic system whether monopoly or oligopoly. GDP growth rate and the employment level in Singapore will also have an effect. The GDP growth rate will determine the company's ability to gain its long-term growth strategies (Xie & et al., 2019). The company should also carefully analyze the availability of skilled human capital as a shortage of skilled labor can affect business efficiency and make talent attraction and retention more challenging.

Social factors: It includes population, age, gender class distribution, educational background, health standards of the country. Demographic trends, power structures consumers' spending patterns, and shared beliefs can help KJR to design effective marketing messages and fulfill its objective.

Technological factors: Technological impact of KJR includes technological development, innovative technology, improvement in the technology, transformation of the product. It directly affects costs and profits (Yu & et al., 2021). Social media use has become very common in a modern business environment. KJR can use the opportunities offered by social media and marketing strategies to improve business performance.

Environmental factors: Some products may become useless because of current weather conditions and climate changes. So KJR needs to consider some environmental factors such as effective Waste management and innovative recycling should be done. Green and eco-friendly products should be used to win the trust of stakeholders.

Legal factors: Laws are required to ensure the quality and price of products of KJR. It also includes discrimination laws and health and safety laws and laws to protect the ideas and patents of the company. The company's reputation should not be harmed due to violation of employees' protection standards.

SWOT Analysis of KJR Construction

Strength in the SWOT analysis of KJR construction:

KJR construction is one of the highest strong brand names in the field of construction and manufacturing in Singapore, which helps the company to gain the trust of its clients across the country and world. KJR also controlled so many big and high scale projects in Singapore and successfully made a trustworthy and reliable brand name that is a very necessary thing in the field of the construction industry (Zhang & et al., 2020). It is also one of the highly respected and trusted company in Singapore for engineering purposes for the technology based on custom made. By having a tough or strong name of the brand and the highly stronger facilities in the field of manufacturing, KJR construction is capable to hold a position of competitive advantage in its place. The technological and advanced capability of the company provides full support to the structure, design, and capabilities of manufacturing. The company also gives expertise in the field of engineering and the project administration department. The technical expertise department of the KJR construction also gives a competitive edge and advantage to the firm.  The financial position of the KJR construction is also enhancing and improved over the last few couples of years as per the latest trends and technological advancements. The total assets of the company are also increasing at a CAGR of 16 percent. And the total capital growth of the company is increasing at a CAGR of 11 percent. When the financial situation of a particular company is improved, then it will provide sustainable support at the time when there will be adverse market situations.

Weaknesses in the SWOT analysis of KJR construction:

One of the major weaknesses of the company is its dependence on the market of the country Singapore. The market of Singapore has an active contribution of almost 67 percent of its total revenue that has been generated by the market, which further makes the KJR construction largely be dependable on the market of Singapore. When a particular company will be over-dependent on any specific market, then it will make that particular company face vulnerability to face any kind of fluctuations in the market of the country (Zhang & et al., 2020). Another weakness of the company is the increment in the debt.  The debt of the KGR construction has been recorded that it been increasing rapidly in the last few years. The debt of the KJR construction has been recorded to increase from S$ 95678 million to S$ 129876 within 5 years. When the debt of a particular company will increase, it will directly impact the flexibility of the company's financial statement.

Ethics Approach

Opportunities in the SWOT Analysis of KJR construction:

To have active growth and development in the field of construction and engineering industry. The industry of construction and engineering in Singapore is increasing by 9 percent year by year (Song & et al., 2020). The KJR construction is positioned well enough to hold and support the opportunity that has been created in the construction and engineering industry. The KJR construction also achieved so many contracts in recent times. The company is also capable to secure new and upcoming orders that have a worth of approximately $25000 million in 2019-20 which also reflected a growth of 9% over the year. The strong project pipelines will guarantee revenue growth.

Threats in the SWOT Analysis of KJR construction:

The company may face the threat regarding the extensive regulations of the environment. The KJR construction is held to follow extensive environmental rules and regulations which are related to waste disposal, health conditions, pollution etcetera (Patittingi & Suciptoroso, 2021). All these environmental regulations will have an increased compliance cost price for the firm. As the prices of oil are decreasing, so many drilling plants and projects have also been stopped and the plants of expansion are also on hold. Hence, this is directly affecting the growth and development opportunity for the KJR construction and to the industry also. The cost price of the buildings that are under construction is also expected to be increased with the GST (Ospanova, 2018). Additionally, an increase in GST will hurt the engineering and construction industry. An increase in the cost of the construction will directly affect the margin and will also increase the cost of transportation. When there will be intense competition within the industry, it will directly reduce the profitability of the firm (Nguyen & et al., 2021). There have been many competitors of the company in Singapore that have very effective resources and very superior capabilities as compared to the KJR construction.

Ethical conduct is the one that is free from any kind of fraud and mistreatments. It also involves the real and possible disputes of interest within the personal benefits against the values of the company. At KJR construction, the workers should behave by the managerial standards of personal honesty, integrity, and ethical conduct while representing the firm (Mustafa Kamil, 2019).

The KJR construction is highly committed to enhancing such an environment of trust, care, and an ongoing learning process while connecting to the expectations of every stakeholder. By having investments in various major section such as availability of water, development of skills, healthcare facilities, educational facilities, the KJR construction focus on the long-term and sustainable development of the society (Liu & et al., 2021). We also tend to start various growth and development steps which will result and have a meaningful effect on the life of an individual. The CSR Approach of KJR construction highlights the procedure to Undertake various programs as per the instructions conducted by the Corporate Social Responsibility Policy of Singapore (Li & et al., 2021). The CSR approach of the company focuses on the key capabilities, power, and strength to have a social infrastructure that is based on technology and innovation.

How KJR construction will manage their CSR –

• to have innovation and technology-based solutions so that the basic needs and problems can be easily and closely addressed.
• to collaborate with several institutions and communities to promote skills, awareness regarding water and sanitation, education, and healthcare.
• to utilize sustainable and well-planned programs of CSR to build and enhance the social infrastructure of Singapore.
• to empower and motivate the people belonging to the socially backward classes and economically backward classes so that they can achieve their possibilities too.

“A goal without a plan is just a wish.”

Four key elements of a plan are: Assess, Design, Build and Manage. Assess: The company will start by collecting external perspective opportunities and threats and internal perspective strengths and weaknesses. Design: Now, the company will move to build or design a framework.  Build: Each level of organization has some building goals (Huangfu & et al., 2022). The company will make sure that its plan covers the financial perspective and customer perspective and operational perspective. Manage: Lastly the company will move to manage the execution because they do not want to build the plan that sits on a shelf.

The culture of the company is an internal part of the business. The culture had a greater impact on almost every aspect of a firm. The culture that has been followed in the KJR construction is a very positive corporate culture. The KJR construction provides freedom at their workplace, provide opportunities to learn, and grass as an individual (Gabriel & et al., 2022). The company also motivates the entrepreneurial and managerial skills which enable a worker to work with proper risks. The company welcomes the opinions, views, suggestions, and open communication within the employees. The company also gives rewards, incentives, compensation to its employees. The company also provides training in various departments.

By having a culture of the ongoing learning process, excellence, and competitiveness, the company makes creates a strong culture. By motivating their employees to be more advanced, innovative, and creative (Chao, 2018). By having a complete focus on their Mission and Vision statement. By giving respect to the values, ethics, integrity, dignity, and diversity, the company will develop a strong culture.

Maslow’s theory of needs talks about the basic necessities of an individual that needs to be motivated for the higher productivity of the firm (BLŠTÁKOVÁ & et al., 2019). He believed that a person first need to achieve their psychological needs for their survival such as water, food, air, and sleep.  Esteem needs will help the employee for social recognition and accomplishment. Self-actualization needs will help in their personal growth. The Trait Approach of a traditional leadership theory includes how one can be an effective leader by testing the basic characteristics. The 5 basic and major leadership styles in this approach are team builder, captain, strategist, creative and impulsive (Barile & et al., 2018). Moreover, the predominance of these leadership styles will directly influence the success of the company or individual. At the top of the unity of command, the chief executive officer is the top who is responsible to manage the entire construction company. When the people will be grouped together, it will help in making the work more efficient and will result in faster development of the construction company. In a centralization, the group of formal authorities is responsible to take necessary decisions for the company such as managerial and professional decisions of KJR construction (Agrawal, 2018). Whereas, on the other hand, the decentralization decision-making of KJR construction is for the lower section of the company.

1. The operations of reclamation must be remained decentralized and restrained through the policies but also be empowered at every level by the authority. This will help in meeting the needs of stakeholders and customers.
2. The standards, rules, procedures, and policies must be developed and be implemented within the company. To enhance the profit of decentralization, reformations must be based on the standards and guidelines of the policies.
3. The technical skills in the regional centers must have a focus on collecting the data, maintenance, daily activities, evaluate and inspecting the overall work.

Conclusion

With the above-discussed aspects of the KJR construction which is a Singapore-based construction and engineering company, it can be concluded that construction companies also need to have a well-developed business strategy for their business. The company is also one of the fastest-growing construction companies in Singapore. The PESTEL analysis and SWOT analysis of the company have also been discussed. Various ethical and CSR approaches of the KJR construction helped them to stay competitive in the market. The culture, unity of command, traditional theory, and motivational theory of the company has also been discussed with a few recommendations for its progress in the coming 5 years.

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