Title: Challenges experienced on a managerial level at S.M.

Jaleel And Company

Assignment Question: Identify three or four management challenges covered in this subject, and address how those challenges can be met using the principles developed in this subject.

Author: Teneille Tang Wing

Word count: From introduction to conclusion 1485

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Executive Summary

Strategic Management can be shortly defined as the long term goals set by an organization. The proceeding sets to show challenges faced by S.M. Jaleel and Company on their journey to success and continued success, as the paper expands it will highlight some shortcomings faced by said company with respect to the principles of Strategic Management. Firstly the paper highlights, the definition of strategic management and strategy then, a short history of the company along with some key factors pertaining to the companys success. From here, this writer chooses to comment and recommend on three noticeable challenges experienced by the company: Human Resource; Financial Management and; the challenge of owning a Family Business.

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Table of Contents

Page
Introduction o Strategic Management and Strategy.. o History of Company Challenge Human Resource Management Challenge Financial Management. Challenge Family Business..

Recommendations

References

Appendix

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Introduction
According to Business Dictionary.com, strategic management is defined as the systematic analysis of the factors associated with customers and competitors (the external environment) and the organization itself (the internal environment) to provide the basis for maintaining optimum management practices. Additionally, strategy is singly defined as the long term direction of an organization (Johnson, Wittington and Scholes 2011), which contains three elements: The long term (which contains three horizons) H1 extending and defending core business H2 building emerging businesses and H3 creating viable options

Direction (according to long term objectives) Organization (of internal and external people, relationships and resources)

Further to this, strategy is not just undertaken by one level within the organization but, exists and coincides with all three particulars of an organization. As follows it exists at: Corporate level: concerned with overall purpose of organization Business level (competitive): concerned with how to compete successfully in a market Operational level: concerned with how corporate and business level strategy can be effectively delivered. Therefore, the strategy undertaken by an organization or simply termed strategic management cannot be applied holistically but has to be broken down at every level of an organization to attain the most effective outcome.

History of Company
Established in 1924, by Shiek Mohammed Jaleel, S.M. Jaleel today now holds the title as being the oldest manufacturing company of non alcoholic beverages in the English speaking Caribbean. Whilst, originally housed at the corner of Keate and Mucarapo Streets, San Fernando, Mr. Mohammed was at that point a mere factory worker till he was able to save enough monies to buy the factory and bring it to its now famed status. Though his first product was called Jaleel
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Beverages, his first soft drink product was named Wonder Beverages, which was produced in 1939. No strangers to innovation even then, as a manual plant, the factory produced ninety (90) cases per hour which were sold at 24 cents per case. In 1959, Jaleel expanded his company to Grenada but soon after came into a drop in market share, where he was forced to make a conscious decision to sell the factory. However, his daughter Salaha Mohammed opted to buy the company along with the help of her husband and acquired funding from other family members. Between 1974 to 1979, the company experienced a major slump producing only a mere 30 cases per day. It was also during this time that they lost its founder and now more than ever Salaha Mohammed was determined to revive her fathers legacy and brought on her son Dr. Aleem Mohammed (now Chairman) to assist in the corporate level decisions. In 1981 they moved from under the house at Mucarapo Street, to where they currently stand now as a pillar in the community. This move brought in modernized technology and machinery, which assisted in increasing market share from 1% to 30%. S.M. Jaleel has always been an export oriented company and from as early as 1982 has been exporting to Jamaica. Today they have expanded to exporting to over 53 countries worldwide with factories as far as Canada and Europe. To date also in major markets such as the United States, in 2003 they sold 2.6 million cases of drinks through the Wal - Mart supermarket chain. As any typical company, S.M. Jaeel was no stranger to the growth and decline curve, but has been able to establish themselves as market leaders being one of the top manufacturing companies and staying ahead of the competition. The company has experienced many accomplishments in its lifespan dating back to 1924 to the present time. Four key factors which have led them to this are: Technological Innovation Strong Entrepreneurial Leadership Investment in People (which can also be disputed as a challenge) and Product Development and Marketing Strategy

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From the above mentioned, for the purpose of study, this writer intends to delve into the managerial aspect of S.M. Jaleel and Company and identify the challenges which they have met along their way to success.

Challenge Human Resource

The human resource of any organization is essential for the progress and continuation of such enterprise. The human resources refers to the people aspect of the organization that runs the day to day activities. Therefore, the Human Resource Department focuses on recruitment, training and provides direction for all persons within the organization. As it refers to S.M. Jaleel, they have stipulated that they show a keen interest in the investment of people i.e. the human resources, but yet this writer has come to the realization that there are quite a significant number of vacancies being advertised for the company (refer to appendix). This can only lead me to presume that there is a high turnover rate. As a result of this, my question is what strategic human resource management practices are being used, if any? I will assume none! Yes the company is successful in their innovation of products and their marketing strategy but the human aspect is also important. Referring to the levels within an organization, at the operational level where the human resources are most in numbers, this level of the organization is suffering the most; consequently, no strategic portfolio can work effectively. Causes of such a high turnover rate could be aligned with the point that there is no upper management/ corporate level infiltration as the company is family owned. This problem is now causing a drain in the development and improvement of the company which can cause them to eventually fall behind the competition.

Challenge Financial Management

Financial management centres around the planning, directing, monitoring, organizing and controlling of the monetary resources of an organization (Business Dictionary.com). In the case of S.M. Jaleel being a privately owned enterprise all of their financial activity is privately

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conducted. Whilst this can prove to be effective to the corporate governing body, the risk of fraud and unethical financial practices can be quite prevalent. Though some may think that this cant or wont occur, once the opportunity presents itself it becomes inevitable. Research shows that the very nature of privately owned institutions has lax control and the monitoring of corporate shareholders is minimal. Though it may not be the case of S. M. Jaleel, just the mere fact that they are a private institution warrants little if not more speculation of financial indescrepancies of this kind. A financial mismanagement, which is most obvious though, is that of their constant expenditure on staff training and development. As mentioned in the previous challenge, this point is of great significance due to their high employee turnover. As most business experts are aware training and development is one of the highest grossing expenditures of an organization and in the case of S.M. Jaleel one is left to imagine the gross effect it therefore has on profits.

Challenge Family Business

Family business like any other business has its own unique challenges. Many of which exist in corporate businesses but are exaggerated more so (Lee Iwan, 2006). S.M. Jaleel and Company is no stranger to the fact, as read in the previous diction. The following points are a few challenges which exist in a family owned enterprise: Informality lack of clear policies and business norms for family members Tunnel vision lack in outside opinions and management of business.. (though they were innovative in their PET technology) High turnover of non family members Succession planning- no sure plan in the handing over of the business as was learnt in the death and downslide of the company in the 1970s Vision each family member has a different view of the direction the business should go.

Though it may seem irrelevant to this company, looking at a broader view to the untold significances for most parts as pointed out in the other challenges the possibility of these existing within the company is expectable. Nevertheless, being a private institution that information may not or will not be for public knowledge.
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Recommendations
In my opinion, this company has successfully in light of some management misgivings, outshined their competitors and has managed to stay at a world class level in the manufacturing and soft drink industry. There is much need for improvement in some departments which may carry them even further. With respect to Human Resource aspect, they should allow for corporate level entry of non family members. This is to ensure that the company is not drained both financially and mentally in resources. This writer is aware of the nature of the enterprise being family owned, but to a point, the view or mediation of a non family member may be a stepping stone to even greater success. Secondly, regards to the financial management, routine and yearly audits should be conducted by external audit companies so as to avoid any lack in corporate governance or even the temptation of fraud.

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References

Articles Building Business Competitiveness, Session Paper, June 2004 pg 11/20 Books Johnson, G; Whittington, R; Scholes, K., Exploring Strategy My StrategyLab Author Royalty, 9E., Financial Times Press (2011) Internet <www.businessdictionary.com/definition/strategic-management.html> <http://www.caribbeanmuslims.com/articles/1037/1/Sheik-Mohammed-Jaleel/page1.html> <http://www.smjaleel.net/career-new-two.htm 10/12/2010> (copy in appendix)

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Appendix

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