Strategic Management and Competitive Advantage
Corporate social responsibility (CSR) is an essential organizational growth model in the contemporary business development stability. For an organization to be deemed stable CSR factors such as social, economic, political and environmental factors are considered. Additionally, the CSR principles consists of great concepts that encourage growth of businesses such as the sustainable changes, the environmental community and fair working conditions for employees. Thus, corporate social responsibility is a vital resource in all businesses. In this regard, on reflecting on the organization made from the simulation game, some of the aspects of CSR are witnessed from the multiple responsible decisions made for the start-up company. The HighLand’s organizational stability can be illustrated through its financial performance and the concepts such as the triple bottom line. CSR is a source of profitability for all businesses if combined with a workable framework (Ferrell et al., 2019). The framework of the CSR distinguishes all the management levels of an organization
CSR states the “rules of the game” for business. On the introduction of a management strategy at HighLand policies that integrated environmental, social and virtuous privileges which were engineered into the company policies (Savina, 2016). With an overall aim to achieve a positive impact in the society as illustrated by the company’s mission statement, HL took the initiative of capitalizing on the establishment of a mutual value with the consumers, stakeholders and employees. CSR oriented activities takes corporate social responsibility into deliberation. The Highland designed cars for Ultra Low Emission Zones which enhances the performance of the cars under low emission. The low emission technology incorporated into the car deigns could help in ensuring environmental safety by reducing carbon emissions into the environment. The HighLand was able to fulfil some of the CSR rules by providing a safe and healthy products that does not pollute the environment.
Also on the social responsibility under the CSR, HL engineered SUV body type for the two car model designs to meet the requirements of the ever-changing car model designs. Moreover, most of its target customers from the25-40 year age gap had families and required comfortable designs for their families. Thus, HL decided to incorporate an efficient SUV with hi-tech technology and comfort that met the customers’ expectations. So, HL was able to meet some of the social accountability by regarding its customers while creating the two car models. Highland incorporated the best technology in creating cars that ensured the safety of its customers. Under the social responsibility of the people, Hl decided to pay its staff higher than the usual minimal rate. The employees were paid £450 which motivated the company staff to provide quality work. Additionally, the plan to increase their wages by 6% annually was a great step towards achieving responsibility towards the society.
The concept of the triple bottom line consists of social, environmental and financial accountability. It is a triple p concept that is planet, people and profit. The methodological approach of this theory evaluates the three aspects which are essential for the organizations stability (Hussain et al., 2018). In HighLand this concept was incorporated with the corporate social responsibility. Its people concept consist of its employees, stakeholders, customers and the overall community. The increase in market shares at the end of its target year illustrated the trust of the society towards its products. HL prioritized customer satisfaction with the hi-tech and comfortable designs while providing a relative price to its customers. The low pricing by the company took its people into account with the medium cars selling at £29500 rather than its competitors like the Nissan pricing at £35400. In relation to the financial stability of the company, the medium cars were sold out in the first year of business. Moreover, the company was able to achieve popularity through regarding its customers’ needs by use of the triple p concept. The planet focuses on the environment and the atmosphere. The zero emission and fuel saving engines fused into the car designs put the safety of the atmosphere into consideration. Whereas the profits comprises of the financial performance of the organization, HL performed adequately with most of its earnings going into employee salaries and the hi-tech designs. The production of these products under the CSR principles proved rather difficult due to the high production assets.
The three principles of CSR dwell on accountability, transparency and sustainability while regarding the financial impact. The sustainability of the Highland organization was concerned with the impacts of actions taken in consideration of the options available. As a measure of an extensive economic and social system, HighLand was unable to regenerate more units of medium cars when they were sold out. The HL organization depleted all of its resources without the ability of regenerating. Thus, at the first years HL had unsustainable operations which was characterised by future lacking of products. However, the unsustainability was catered for by developing future sustainable operations that aimed towards efficiency of producing more car units. Any decisions that an organization undertakes always has an impact on the external environment ( Jordao, 2017). The HL was highly responsible in recognising the quantification of the actions it took. As a part of a wider societal network the HighLand organization evaluated some of its responsibilities towards the environment, thus, producing zero emission cars. The HighLand also practised transparency in its production activities. The transparency enabled it to create trust with its customers and in the market as envisaged by the growth of markets shares in the European car industry.
In Toyota’s organization sustainability is at the centre of their actions and decisions (Kanagavelli et al., 2018). Toyota’s aim to deliver services and products that enhance the people’s lives and respects the planet. Moreover, Toyota took the initiative of inventing a Toyota Environmental challenge to emphasize on the importance of the environment in business. According to its guiding principles it works on initiatives that bring about sustainable development. Grounded on the Toyota “Customer First” policy, they aim to deliver excellent products and provide a safe and innovative environment to their customers. Most of the guiding ethics in the Toyota industry aims to improve the lives of its customers in the society. This auto making industry strives to guard private data of their stakeholders and customers who are involved with them in business as per the privacy laws. Toyota motor cooperation strives to oversee the CSR responsibilities by delivering a fair operating environment for its staff. The firm collaboration and effective communication with the staff builds the success that backs the individual growth of their employees. Moreover, Toyota upholds the community guidelines by discouraging bribery.
In the Toyota cooperation, stakeholders are given opportune and adequate disclosure of the company’s financial situations. The societal aspect of the CSR is taken under consideration through these actions. The business worth of Toyota is enriched as they develop steady associations with stakeholders and customers. The long-term associations help in the overall financial performance of the company as it gains more acknowledgement in the market. Based on the key financial report of the Toyota enterprise, it has an improvement of net sales by 11% putting their total income at £2.2 million ( Melczarek at al., 2016) .However, the income tax had decreased by 4% in the previous years. The multiple investments Toyota makes in the multiple environmental initiatives takes most from its earnings. Consequently, the solidity of Toyotas financial stability is maintained through the cash flows and short term investments. In 2109 alone, Toyota place £ 24m in innovation of equipment and property. The investments in properties while following the CSR guidelines has proven to be expensive. Thus, the financial relations to the CSR is affected due to the additional finances required to uphold its principles. Amid the growing challenges in the economic environment, the pursuit of safer cleaner techniques to meet the ever-changing policies takes most of the earnings from the company. Still, some costs have been saved by following social responsibilities in the cooperation.
Corporate social responsibility is a complex concept when regarded in terms of businesses. It has standardized benefits which are encompassed by various initiatives companies take. The formation of a link between environmental, social issues and business goes a long way in the financial growth of a business. From the study of Toyota, great internal CSR such as the creation of a fair operating environment for employees improves quality production and work. Most people prefer CSR due to the positive attributes it comes with that considers their well-being in a working environment. CSR can improve financial performance based on the emerging businesses. Good corporate governance in relation with CSR initiatives builds the financial performance of businesses in the car industry. Yet, some CSR practices have proven challenging due to the various additional revenue they require. Through the adoption of sustainable CSR practices, business are able to stabilize their financial growth. These sustainable approaches such as using waste as by-products increases the returns the company makes, since its takes its use of income into consideration avoiding wastage. Overall, Corporate social responsibility can build company performance when used correctly without creating of unsustainable initiatives.
References
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