Managing People and Organizations.

Assignment – Learning Outcome 01

T. N. W. de Silva
20S08094
Batch 033

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 Faculty of Management Studies
Department of Business Administration
SQA
Academic Year: 2019
Assessor : Thaksala Nirmani
Unit Code : HP71 47
Title of the Unit : Managing People and Organisations
Outcome :1
Batch : 33
Assignment Issued Date : 6th of June 2020
Assignment Submission Date : 20th of June 2020

Declaration of Academic Honesty

Student’s Full Name : Thommadura Namali Wathma de Silva
Student ID number : 20S08094
Declaration
1. I confirm that this assignment is my own work:
2. I confirm that where ever I have used someone else’s words, concepts, graphics or data in
my work, I have clearly indicated exactly where I have done so, using the Harvard
referencing system.
3. I confirm that I have clearly indicated, by referencing, where I have used someone else’s
words, concepts, graphics or data, irrespective of whether I have quoted verbatim or I
have paraphrased in my own words.
4. I have clearly indicated in my assignment any work that has been contributed by another
student.
5. I have clearly indicated in my assignment any work that has been carried out
collaboratively with another student/s.

Student Signature: Date: 16.06.2020

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 ACKNOWLEGEMENT

I would like to express my special thanks of gratitude to my teacher Miss. Thaksala

Nirmani for teaching the required subject matter and giving us the proper guidance
to complete this assignment. And also I am thankful to my parents and my friends
who helped during the studies and motivating me to complete this assignment.

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 TABLE OF CONTENTS

Executive Summary………………………………………………………………………..01
Introduction………………………………………………………………………………...03
01. Importance of goals, objectives and policies
01.01. Goals and Objectives……………………………………………………………...04
01.02. Policies……………………………………………………………………...……..05
01.03. Contribution of goals, objectives and policies to effective management…………06

02. Formal Organizations and Informal Organizations

02.01. Formal Organizations……………………………………………………………..07
02.02. Informal Organizations……………………………………………………………08
02.03. Difference between Formal and Informal Organizations…………………………09

03. Open System Theory

03.01. Organization as a system………………………………………………………….11
03.02. S.W.O.T. Analysis…………………...……………………………………………12
03.03. P.E.S.T.E.L. Analysis……………………………………………………………..14

04. Stakeholder Theory

04.01. Stakeholders……………………………………………………………………….15
04.02. Mendelow’s Matrix………………………………………………………………..17
04.03. The influence of Stakeholders to the business…………………………………….18

05. Control Strategies

05.01. Different kinds of control strategies……………………………………………….20
05.02. Effective control strategies to J.O.C. Company…………………………………...22

06. Conclusion and Recommendations……………………………………………………..23

07. References………………………………………………………………………………24

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 Executive Summary

This is the 1st assignment from learning Outcome 1 of Managing People and Organizations. This
assignment is based on a case study about Joy Of Chocolate Company. It is basically a gourmet
chocolate producing company with a well-qualified staff. It supplies best quality chocolates to
luxury hotels and organizations. Later J.O.C. Company merged with C.G. Chocolates which
helped the growth and development of both merged companies.
Goal, Objectives and Policies are very important to J.O.C. Company because they provide the
basis for measuring the performance and process to make to the vision and mission statements.
And also they are important to motivate the employees, lately resulting the improved
performance. All these facilitate planning and provide proper guidance and direction. J.O.C. has
primary goals such as to make awareness of product quality and uniqueness, to increase the
customer loyalty and satisfaction, to increase the profitability, to increase sales and to survive in
the market. As objectives they have many. Such as make sure to deliver the products with
required quality and on time to customers to increase the customer loyalty. And also to gain new
markets, gain new business contracts with local councils and reduce the waste during process to
increase the profit. And also J.O.C. has many policies such as quality culture, team work and
development, ethical trading initiations, employee well-being, health and safety and
environmental policies.
J.O.C. Company has both formal and informal organizations. Formal Organization has a well-
defined and organized structure composed of top management, middle management, front line
managers and the employees (workers). They all work together according to a plan in order to
achieve organizational goals. There the managers are taken the rules and regulations and the
lower level employees have to work according to them, otherwise they are punished. In contrast
there are some informal organizations inside the formal structure. Positive and healthy work
culture of the organization, healthy employer-employee relationship and some projects may have
facilitated the formation of informal groups inside the formal structure. Not like formal
organizations, informal organizations are formed by the social forces spontaneously, without any
planning. There are no well-defined structure and no fixed superior and subordinate relationship.
The purpose of informal groups is to fulfill the psychological satisfaction among the employees.
J.O.C. Company is also a system, which is combined with many small systems called the
departments and firms. If one small part of the system changes, that influences on the overall
production of the J.O.C. system through many kinds of relationships. In J.O.C. system there are
inputs, processes and outputs, and these outputs are influenced on the goals, learning, evaluation
and assessment. In each step of inputs, process and outputs J.O.C. interacts with the external
environment. So J.O.C. is considered as an open system. Open system is the system which
regularly exchanges feedback with its external environment. Since there are major influences
from external environment on J.O.C. it is important to study and analyze the external
environment. S.W.O.T. Analysis (analysis about the strengths, weaknesses, opportunities and

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threats of J.O.C.) and P.E.S.T.E.L. Analysis (analysis about the positive and negative impacts
from Political, Economic, Socio-cultural, Technological, Environmental and Legal dimensions to
the company) are the main two tools used in analyzing the internal and external environment.
Stakeholders are all parties who are interested about the company. J.O.C. has internal
stakeholders (management, employees), connected employees (customers, suppliers) and
external stakeholders (Government, community, pressure groups and Government
administrations). These stakeholders are then analyzed according to Mendelow’s matrix to
identify their power and interest towards J.O.C. It shows the influence on J.O.C. form the
stakeholders and it shows the important stakeholders and how to maintain a healthy relationship
with the stakeholders. According to Mendelow’s matrix the key players (who have a high
interest and a high power) are J.O.C. management, their major customers (Luxury hotels,
organizations, local firms and shopping centers) and their major suppliers (Chocolate and cocoa
suppliers from Dominican Republic and Ivory Coast). To maintain a healthy relationship with
them, J.O.C. has to make payments and provide their products on time with the expected quality.
There are 4 controlling strategies. They are personal, Bureaucratic, Output and Cultural Controls.
But to J.O.C. personal and bureaucratic controlling strategies are not suitable because it leads to
hinder the creativity and innovations of the employees, which is very important to a chocolate
factory. But Output control and mostly cultural control is more suitable to J.O.C. because they
help to keep the employees motivated, and that paves the way to a self-sustaining business.

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 INTRODUCTION

This is the first assignment which is based on the first learning outcome of Managing People and
Organization. This assignment covers the relationship between organizational goals, objectives
and policies and how it can influence the effective management, the nature and difference about
formal and informal organizations, the nature of open system theory and the control strategies of
the business.
This assignment is based on a case study about the Joy of Chocolates Organization. J.O.C. was
created in 1999 by Suzy Campbell who is a professional chocolatier. J.O.C. is based on Stirling
and they produce a wide range of gourmet chocolates with excellent quality and uniqueness. The
gourmet chocolates are enhanced with local products such as heather honey, whisky and locally
grown fruits. Their main customers are luxury hotels and organizations and J.O.C. has developed
a reputation for excellence and dependability. Their main suppliers are chocolate and cocoa from
the Dominican Republic and Ivory Coast. Suzy and her assistant Mary always supervised the
quality of the quality of the supplies according to their standards. And also Suzy developed a
very close relationships with suppliers and maintained ethical responsibility, and maintained a
positive culture in all aspects of the business. Leon is the Head of Chocolate development and
Hafiz is the factory manager. They two maintained the Health and Safety and food production
policies. And they two facilitate the positive work culture in J.O.C.
In 2004 J.O.C. experienced financial difficulties due to inconsistent cash flow and they were
close to being declared bankrupt. But J.O.C. has survived because of the mediate of Amina who
works part time as the Financial Analyst and Adrian’s project to keep the waste to minimum to
increase the profitability. The business grew quickly and they identified the exclusive hotels in
Ayrshire and the Scottish Boarders as a market that J.O.C. could exploit. And Suzy decides to
enroll new employees and give them a three month training.
Later J.O.C. merged with C.G. Chocolates and both worked together. It increased the market
opportunities. Suzy was the managing director of merged companies and Hafiz and Adrian run
the Stirling J.O.C. Company and Leon and Mary run the Newcastle C.G. Chocolates. And Amina
became the permanent Financial Manager. The merged companies were able to make contracts
with local councils to provide luxury gift chocolates. And they are expecting to introduce
corporate gifts to sporting events. The London Olympics and The Glasgow Commonwealth
Games are the perfect opportunities.
In this assignment the relationship of goals, objectives and policies towards the effective
management of J.O.C., the formal and informal organizations in J.O.C. , the composition of the
J.O.C. open system, the different stakeholders and how they are influenced to J.O.C. and the
appropriate control methods of J.O.C. are discussed.

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 01.Importance of goals, objectives and policies of an organization
to effective management.

01.01 Goals and Objectives.

A goal is defined as “An intermediate result to be achieved by a certain time as part of the grand
plan. Therefore a plan can have many goals.” Goal is a desired target of an organization, and it is
usually broad and long-term. So goals provide the basis for measuring the performance and
process to make to the vision and mission of the organization. Goals can be set for employees,
production, process, sales, development and for many more.
On the other hand objectives are measurable and specific actions should complete by the
employees in order to achieve the overall goals. Objectives answer all how, why, to/by whom,
and when factors of a goal. Typically an effective objective should be S.M.A.R.T. (Specific,
Measurable, Achievable, Realistic and Time constrained.) A goal is a generic action, but an
objective is specific.
Example: Goal – Increase the market share of retail segment.
Objective – Increase the market share of retail segment by 10% at the end of 2020.
There are several types of goals and related objectives of J.O.C. They are as below.

Type of goals Goals Objectives

- To make awareness
about the excellence and
innovativeness of their
chocolates.
Product goals
- Add uniqueness to the
products and be
significant than their
competitors.
- Reduce the wastage
- Increase the productivity
Process goals
while maintaining a good
quality.
- Create gourmet chocolates that would be
enhanced with local produce such as
heather honey, whisky and locally grown
fruit.
- Introducing a wide range of flavours.
- Testing and innovating new flavours and
different products.
- Maintain good relationships with the main
suppliers of chocolate and cocoa from
Dominican Republic and Ivory Coast.
- Mary’s responsibility to ensure all the
supplies and deliveries met the company’s
high standards, to maintain the quality of
products.
- Adrian’s appointment to keep the waste to
a minimum.
- Introduction of a project to combat waste
and lower costs involving staff from all
areas of the factory.

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- Create brand loyalty
Consumer
- Increase brand reputation
goals
for dependability.
- Identify and exploit new
markets.
Sales goals - Increase the sales.
- Profit maximization
- Survival in the market
Employee - Increase employee
goals satisfaction
- Increase employee
productivity.
Table 01.01: The Goals and Objectives of Joy of Chocolate Company.
- Maintain a good relationship with luxury
restaurants, hotels and organizations
(Major customers)
- Understand and identify customers’ needs,
and create specialist chocolates for their
specific requirements.
- Make sure the customers receive the
products on time, and up-to their
expectations.
- Introducing products to exclusive hotels in
Ayrshire and Scottish Boarders.
- Gain business contracts with local councils
to make corporate chocolate-gift business.
- Introduce chocolate products related gifts
to sporting events. (London Olympics and
the Glasgow Commonwealth Games)
- Recruit a marketing and sales specialist.
- Provide a 3 month training program to
newly recruited employees.
- Provide employees skill development
programs.
- Create a positive work culture by engaging
employees to taste testing of the products.
- Provide employees the required
equipment.

There are several goals in many fields of the company. And also there are many objectives.
These objectives satisfy the S.M.A.R.T. concept for some extend, because in some places the
objectives can’t measurable, and the time duration hasn’t mentioned. But they are very realistic
and specific, because the objectives and goals which were planned at the beginning of the
business has been achieved. And now the goals and objectives are expand as the growth of the
business. That will help to motivate the employees to greater outcome.

01.02 Policies
Policies are the written rules, procedures and principles which are established by the organization
to show how the organization is going to survive and achieve long term goals. They are the core
principles that the organization value, and they reflect the Organization’s image to the
stakeholders and to the society.

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These are the policies which are found in Joy of Chocolate Company.
- Quality culture of the products.
- Health and Safety
- Team work and development
- Positive work culture
- Ethical responsibility
- Ethical trading initiative
- Customer satisfaction
- Employee well-being
- Environmental policy

01.03 Contribution of Goals, Objectives and Policies to effective management.

Objective 1: A
Goal 1
Objective 1:B

Objective 2: A
Goal 2 Mission and Vision Statements Organizational Growth
Objective 2: B

Objective 3: A
Goal 3
Objective 3: B
Figure 01.03 – Purpose of Organizational Goals and Objectives

As the above figure indicates, objectives and goals are directly involved to the mission and
vision statements. According to Barney and Griffin, organizational goals and objectives serve
four basic functions.
- They provide guidance and direction,
- Facilitate planning
- Motivate and inspire employees
- Help organizations evaluate and control performance
In J.O.C. the goals, objectives and policies helped and guide Suzy to improve her business from
the bottom to the present successful stage. The goals directed and motivated her to plan, and use
her skills more effectively to improve the quality and the creativity of the products. And also the
team work and positive work culture helped to improve employee satisfaction. And the
individual goals helped employees to measure their success in meeting targets and strengthened
team morale and helped employees take pride in their work.

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 02. Formal Organizations and Informal Organizations

02.01: Formal Organization

Organization is a group of people working together under a deliberate structure to achieve a
common goal.
A formal organization is deliberately designed with well-defined jobs and responsibilities
targeting to achieve organizational goals. “As pointed out by Udo and Akpa (2010) and Okon
(2004) a formal organization is an assembly of individuals who carryout separate but interested
and coordinated functions for specific tasks accomplishments.” (R. Etor, 2016) Formal
organizations are characterized by a well-defined organizational structure, division of labour,
task specialization and adherence to the rules, regulations and the policies which are made by the
top management. Here the vision and mission are well-defined, and all the employees are
working together to achieve all the long-term and short-term goals.
High Authority Suzy Campbell – Managing Director of Merged Joy of Chocolates
Top and CG Chocolates.
Management

Leon Houmond (Head of Chocolate Development), Hafiz Shah

Middle (Chocolate production factory manager), Amina Zan (Finance
Managment manager of J.O.C.), Jimmy Mulvenie (Sales Manager of C.G.C),
Jack Ridgewell (Finance Manager of C.G.C)

Mary Taylor (Supervisor of controlling quality of supplies,

Front-line management Assistant of Finance Manager), Adrian Buchanan
(Supervisor of waste minimization and quality of the
products)

Workers All the workers in production, packaging, delivery,

finance, and sales departments.

Figure 02.01: Formal structure of Merged J.O.C. and C.G. Companies

In J.O.C. all the members work together to achieve a common goal. The management team
believed that quality and the continued success of the firm depended on everyone contributing as
an individual part of the team to achieve targets. That is their common goal. Suzy makes the
decisions and plan, and other directors direct and control other employees to reach Suzy’s
targets.
Formal Organizations generate clarity on what support and input each employee can expect from
others, and in turn what is expected of him by others. And also it promotes discipline in the
organization. Also it is easy to review and revise organization with changing requirements.

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But there are some disadvantages also. This kind of organization doesn’t allow flexibility, and
doesn’t allow long-term planning. And it reduce the scope of creativity.

02.02: Informal Organizations

This refers to the relationships between people in the organization based on personal attitudes,
likes and dislikes. Here the members are voluntary, and the relations are unplanned because the
formation of these organization is a natural process. It reflects human relationships. Their
primary aim is to protect the welfare or interests of its members. It exists in all formal
organizations as pressure groups and cliques to monitor the activities of the leadership of the
formal organization. (R. Etor, 2016)
An organization is neither totally formal nor informal, but a combination of both the aspects.
Both the formal and the informal organizations co-exist together. One cannot be separated from
the other, since both are related to each other. Both the types of organization affect and are
affected by each other. (Tulsian, 2002)
Informal organizations give a sense of belonging and personal satisfaction to the employees. It
gives a value for their emotional problems, and it is an aid on the job, because the members can
help others. And it is an important channel for communication. Informal organizations are aid to
management (provide feedback and work experience), and it increase the productivity. And also
it lessen the managers’ supervision.
Like advantages, there are also some disadvantages. The members are bound to their culture and
customs, because of that they are resistant to change. And members put their own group
objectives ahead of organization’s objectives. So the organization suffers. And also this is a great
way to spread rumors.
J.O.C. Company values positive work culture, and also the relationship between the employee
and employer is very healthy. And also they value team work, and the development as a team.
All these things hint about the existence of informal organization inside the formal J.O.C.
Company. And also all the projects, volunteer blind tasting events and chocolate naming events
are open to all the employees in every organizational levels. So these events facilitate the
chances to get to know about each other and share their interests and ideas with each other. This
increases the chances of forming informal organizations.

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 02.03: Differences between Formal Organizations and Informal Organizations.

Point of difference Formal Organizations Informal Organizations

Formed deliberately with a proper Formed by the social forces spontaneously

Formation
plan of the top management. without any planning.

Well- defined organizational

No well-defined structure, no well-fixed
Structure structure, has a fixed superior and
superior and subordinate relationship.
subordinate relationship

To work according to a plan to Fulfill the psychological satisfaction among the

Purpose
achieve the organizational goals. employees.

There’s a direct relationship No such relationship with authority and

Leadership between authority and leadership. leadership. Even the person with lowest
Managers act as leaders. authority can be a leader.

Always flow from top to bottom

Flow of authority Can flow in any direction.
layers.

There is no managerial control on the behavior.

Behaviour of the Decided and controlled by the
If there’s a negative behavior, managerial
employees management.
actions may interfere.

Communication takes place from

There’s no fixed path. Communication can
top to bottom layer or bottom layer
Communication travel from any side. Mostly oral
to top layer. Written communication
communication is used.
is more prominent.

Top management make rules and

Rules and regulations and employees have to There’s no rules and regulations. And there are
regulations follow them strictly. If not there are no punishments.
some punishments.

Advising, threating or firing Physical and social sanctions. (Cultures and

Control mechanism
demotion. norms)

Not very stable and durable. Because members

Stability and Very stable and durable. It exists till
can change their friendly and social groups
duration the survival of the organization.
whenever they decide.

Table 02.03: Differences between Formal Organizations and Informal Organizations

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 03.Open System Theory.
All systems have boundaries. When considering about the open systems of an organization, the
boundary between the organization and the external environment is porous. So a good and
successful organization regularly exchanges feedback with its external environment. This is what
open system theory explains. A closed and isolated system is unhealthy to organization, because
an organization has to maintain relationships with its external environment to achieve its goals
and for the growth and development of the organization.
The external environment contains of wide variety of needs and influences which can affect the
organization, but the organization cannot directly control the external environment forces. The
influences can be Political, Economic, Socio cultural, Technological, Legal and Environmental.

J.O.C. Company’s Business Environment

Internal Environment External Environment

Task Environment General Environment

Owner: Suzy
Campbell
Employees: 15 full
Competitors
time employees by
2011 Suppliers: Chocolate and Political Forces
cocoa suppliers in the
Mission Economic Forces
Dominican Republic and
Vision Ivory Coast. Socio-cultural Forces
Goals Customers: Luxury hotels and Technological Forces
restaurants, local councils and
Objectives Legal Forces
shopping centers
Policies
Regulation Authorities
Values

Figure 03: J.O.C. Company’s business environment.

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03.01: Organization as a system.
Meadows and Wright (2008) defined system as an organized collection of parts or subsystems
that are integrated to accomplish an overall goal. (Pearsonhighed, N.D.) Organization also
composed of many units/departments. In J.O.C. Company there are chocolate Production unit,
Packaging unit, Sales unit, Finance unit, Customer service unit and Billing and Shipping unit and
each of these units is a system. If one part of the system is changed, the overall system (The
J.O.C. Company) is likely to be influenced through a network of connections. For example if the
marketing department doesn’t effectively promote the chocolate products, the sales may go down
and the expected profit may not come. As a result of that employees will be laid off. Systems
exist at many different levels in an organization, and the performance of one system influences
the performance of the overall system. (Pearsonhighed, N.D.)
So in a healthy organization, the inputs, process and outputs should be maintain effectively and
efficiently to achieve the expected goals and objectives. A failure in any part can be affected to
the overall performance. The figure below shows the overall open system of J.O.C. Company.
Each phase exchanges feedback with external environment.
Goals

INPUTS PROCESS OUTPUTS Learning

Evaluation
Raw materials Production Chocolate
Machines products Assessment
Packaging
Qualified staff Reputation
Management
Policies and Brand name
Marketing
values
Waste
Quality
Ideas
assurance
Money
Team projects
Time

External environment is very important to an Organization. So it’s important to study about the
external environment, that how the environment’s forces can affect the organization. There are
common two tools which are used to examine the external environmental forces. They are
SWOT Analysis and the P.E.S.T.E.L. Analysis.

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03.02: S.W.O.T. Analysis
S.W.O.T. (Strengths, Weaknesses, Opportunities and Threats) is a strategic planning tool which
is used to evaluate an Organization’s current position of the market and that can be used to
develop strategic planning to determine the Organization’s future position. From strengths and
weaknesses it show the influences from internal factors and from opportunities and threats it
shows the influence from the external forces.

S W
The characteristics the The characteristics
company owns, which which are
are advantageous disadvantageous and
compared to others. should be improved in
future.

O T
The external factors The external factors
which can be used which can be affect to
positively to the growth the business negatively.
of the business.

Figure 03.02: The S.W.O.T. Analysis.

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 This is the S.W.O.T. Analysis of J.O.C. Company.

- Well-qualified staff members. (Suzy has achieved professional qualifications

in chocolate making, and 6 months of work experience with chocolate firms
in Europe. And also she has skills in managerial, forward planning and
developed sales expertise. And Leon has trained in Switzerland about
chocolates.)
- Good demand for chocolates in luxury hotels and organizations.
- Unique products which are enhanced with local products.
Strengths
- Company possess latest equipment in production.
- Reputation for excellence and dependability.
- Positive work culture.
- J.O.C. Company approached the local college to offer work placements in the
departments of finance and production.
- Collaboration with C.G. Chocolates.
- Good relationships with the major customers and suppliers.
- Financial Management weaknesses (Inconsistent cash flow) In 2004 they
were close to being declared bankrupt.
- Unhealthy food label (More sugar and fat content)
Weaknesses - Their current market has only restricted into Europe.
- Suzy has interfered unnecessarily to the decisions of her managers (Leon),
and that demotivated Leon, and that made his colleagues and himself began to
consider leaving the company.
- Global expansion of the business.
- Potential to introduce corporate gifts to sporting events. (London Olympics
and Glasgow Commonwealth Games)
Opportunities - Introducing more chocolate related sweets. (not only chocolates)
- Explore new flavours to chocolates.
- Opening of new market at shopping centers and contracts with local councils
after merging with C.G. Chocolates.
- Competitors
- Competition in luxurious gift market.
Threats - Modern trend of health consciousness.
- Recession in UK. (Financial fluctuations)
- Unfavourable tax and Government policies to business.

Table 03.02: SWOT Analysis of Joy of Chocolates Company

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 03.03: PESTEL Analysis
PESTEL analysis also a strategic planning tool which is used to identify the macro (external)
forces facing an organization. The letter stands for Political, Economical, Socio-cultural,
Technological, Environmental and Legal forces. Sometimes an additional “Ethical force” also
can be added. This is advantageous because we can identify influence of external environment to
the organization, and it also help to plan the goals and objectives for future purposes. Here the
negative and positive impacts are considered in each force.
This is the PESTEL Analysis of J.O.C.Company.
Dimension Positive Impact Negative Impact
- Taxes imposed on the sales can
- Trade agreements between the affect the profitability.
stakeholders are important in - Government acts about health
expanding the company. promotions. (Most of the
- Political stability of the country is European countries have rules
Political
important in the progress and the and regulations about the sugar
growth of the company. content of foods)
- Investor friendly tax and Government - Political instability can affect
policies. initiating new outlets in
different areas and continents.

- Poor employment rates and

- Slow and stable growth of economy
of the country is helpful.
Economical
- Increasing peoples’ salaries can
increase the demand for chocolates.
economic instability in a
country is unfavourable.
- Recessions inside the country.
- Bad fluctuations in international
currency can be demotivate the
company to export.

- Many people like chocolates even

they know chocolates are unhealthy. - Healthy lifestyle trend.
Socio-cultural
- In some cases the gourmet chocolates
is used to show the social status.
- Company can start online ordering
and online paying methods.
- Can use social media for online
- Distribution of false
marketing.
information and rumors through
- Can use new technological machines
Technological social media very quickly,
and knowledge to reduce the
which can affect the brand
production cost and increase the
name and customer loyalty.
quality.
- Can introduce new flavours and high
yield cocoa species.

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 - Damage done to the
- New trend of green concept. That will
environment. The chocolate
Ecological help to innovate new eco-friendly
wrappers are plastic and
packing materials.
polythene.
- Government regulations to
reduce the unhealthy food.
(regulations about the sugar and
fat content)
- The law to display ingredients
Legal - Investor-friendly acts.
and nutritional facts on the
cover.
- The law about minimum
working hours and minimum
salary.

Table 03.03: PESTEL Analysis of J.O.C. Company

03.Stakeholder Theory.

04.01: Stakeholders.
A stakeholder is a party that has an interest in a company and can either affect or be affected by
the business. The primary stakeholders in a typical corporation are its investors, employees,
customers and suppliers. (Chen, 2020) They have different intentions about the business. The
stakeholders can be internal or external. Internal stakeholders are those who have a direct
relationship to the business by employment or ownership. Connected stakeholders are who has a
direct relationship with the business by an investment. And external stakeholders are those who
do not have a direct relationship with the business but they are affected in some-way by the
actions and outcomes of the business.
Here are the stakeholders of J.O.C. Company.
01. Internal Stakeholders

- Management (Suzy Campbell the owner, Leon the head of Chocolate development, Hafiz
the Factory Manager, Amina the Finance Manager)
- Employees (Amina, and Adrian the supervisors and all the employees in production,
packing, sales and marketing)

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 02. Connected Stakeholders

- Customers (Luxury hotels and organizations, exclusive hotels in Ayrshire and the Scottish
border, shopping centers, local councils)
- Suppliers (Chocolate and Cocoa suppliers from the Dominican Republic and Ivory Coast)

03. External Stakeholders.

- Government
- Community
- Pressure groups (Trade Unions, Associations)
- Government Authorities (Environmental Authority and Consumer Affair Authority)
- Competitors

04.02: Mendelow’s Matrix

Mendelow suggests a way to analyze the stakeholders according to the power (the ability to
influence the organization strategy) and Interest (How interest they are in the organization) they
have. It gives an idea about the stakeholders’ influence towards the business. It provides to
identify who are the most important stakeholders to the progress of the business and how to
maintain the relationship with them. And also it gives an idea about setting the overall
organizational goals, aligning with the key players’ goals.
Here is the stakeholder analysis of J.O.C. Company according to Mendelow’s Matrix.

POWER
Category A- Minimal Effort Category B-Keep Informed

- Contract based employees - Permanent employees

- Interns - Informal organizations inside the business
- Society

Category C- Keep Satisfied Category D- Key Players

- Government - Management (Suzy Campbell the owner, Leon

- Consumer affair Authority
- Environmental Authority
- Health Authorities
- Media
the head of Chocolate development, Hafiz the
Factory Manager, Amina the Finance Manager)
- Customers (Luxury hotels and organizations,
exclusive hotels in Ayrshire and the Scottish
border, shopping centers, local councils)
- Suppliers (Chocolate and Cocoa suppliers from
the Dominican Republic and Ivory Coast)

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INTEREST
T
04.03: The influence of Stakeholders to the business

01. Category A- Minimal Effort

They have low level of interest and low level of power. Because of that it’s easy to replace
them. They can be found easily in the market. So the organization don’t pay much attention and
time towards them.
02. Category B- Keep them informed.
This group has a low power, but a high interest towards the business. Permanent employees are
very interested about the progress and profitability of the business because they want to get their
outcome from the company. Trade unions and different associations within the company are also
interested about the company’s progress, because the groups are also survive on the organization.
But they have not power to make or alter the decisions about the company. But these groups are
needed for the company to run. So the company has to inform them before making any decisions
related to them. Otherwise they will make some disturbances.
J.O.C. has a positive work culture and the employer-employee relationship is very healthy and
strong. And also employees were asked to join to new chocolate blind tasting and brand naming
programs. That increased the employee satisfaction and build a strong relationship with them.
03. Category C- Keep satisfied.
This group has low interest but a high power towards the business. Government reugulatary
bodies, Consumer affair authority and Environmental authority has already imposed some rules
and regulations regarding the process and outcome of the business. So J.O.C. has to work up-to
their standards to keep them satisfied, or else they can inhibit the trade license or even can close
the company. Media also can ruin or promote J.O.C. brand name. So media also should kept
satisfied to run the business.
04. Category D- Key Players
This group has a high power and also a high interest towards the business. The owner and the
managers have a high interest because they have to make the business profitable and they also
powered enough to make and alter the rules and decisions. Main customers (Luxury hotels,
organizations and local councils) and the key suppliers (Chocolate and cocoa suppliers from
Dominican Republic and Ivory Coast) are very important to run the business. So J.O.C. should
consider about their goals and should align their goal with the organizational goal. J.O.C. should
consider the demand of the customers and should set the organizational product goal more than
that. And also the product supply should be continuous and should deliver them on-time. The
key suppliers are very important, and they can’t be easily replaced, because it’s hard to find a
supplier who supply chocolate and cocoa, machinery and packaging large quantity with the same
quality they want. If they stop their supply, the business can’t be run. So J.O.C. has to pay more
attention to them and keep them satisfied by making the payments on-time.

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J.O.C. makes the payments to the suppliers at the end of each month as the Ethical Trading
initiative. And Suzy maintained a very good and closed relationship with them. And these things
helped to keep connected to the suppliers. Also Suzy meets J.O.C.’s major customers regularly
and get to know about their needs and wants, and make sure to provide the products according to
their requirements, and deliver them on time with high quality. These things facilitates a healthy
relationship with the customers.

05 Control Strategies

05.01: Different kinds of control strategies.

Control in a business setting, or organizational control, involves the processes and procedures
that regulate, guide and protect an organization. Control is one of the managerial functions,
which are planning, organizing, leading and controlling. Business control systems consists of
processes which help to achieve organizational goals and objectives. Controls show how
employees should direct themselves and perform their job most effectively and efficiently. The
purpose of the control strategies is to ensure that a specific function is performed up-to the
organizational standards.
Control strategies have many benefits. Some of them are improved communication, increased
productivity and efficiency, improved morale in employees, good quality control and the ability
to achieve the goals and objectives. And also it provides the basis for better planning and
organizing.
There are mainly four types of controlling strategies.
01. Personal Control
Personal control is control by personal contact and direct supervision of subordinates. Personal
control consists of making sure through personal inspections and direct supervision that
individuals and units behave in a way that is consistent with the goals of the organization.
(Methods of Control in Principals of Management, 2002) Personal control normally happens in
small firms, where the employees work under the direct supervision of the owner, or the
supervisors. The observer has the centralized power and authority.

02. Bureaucratic Control

Bureaucratic control is the use of formal rules and regulations to control employee behavior to
lead them to achieving goals and to influence, monitor and assess employee performance.
According to Weber, bureaucratic control is typically defined as control through a formal system

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of written rules and procedures. Here the rules and regulations are set for the requirements for
behavior and define work methods. Bureaucratic controls help to organization to achieve goals
by shaping employees how to perform, creating accountability to outcomes and correcting
behavior in necessary places.(Methods of control in Principals of Management,2002)
The main advantage of bureaucratic control is it’s easy to the manager to continue command and
control cycle. The employees do what-ever the manager decides. Decision making is easy when
there are only few individuals are involving. From that the whole organization work as one unit
and easy to control. Leads to high production.

03. Output Control.

Output control is meant by setting goals for subunits to achieve and expressing those goals in
terms of objective performance metrics. It gives an idea about how many employees are needed
to complete a specific task, and it measures the employees’ capacity. Output controls are the
goals which are set to a separate division or and individual. Their performance is measured and
monitored against those goals. Then the unit manager’s performance is judged by their ability to
achieve the goal. If the goals are reached, they are rewarded, and if goals are not reached, the
managers are advised to find out why they were unable to reach the goals and to take required
actions to recover it. Control is done by comparing the actual performance against the expected
performance. And then the managers take actions to reduce the deviations.

04. Cultural Control.

Organizational culture is composed of all the values, believes and values of the organization.
Cultural control involves regulating behavior by socializing employees so that they internalize
the values and assumptions of the organization and act in a manner that is consistent with them.
(Methods of Control in Principals of Management, 2002) Cultural control exists when employees
buy into the norms and value systems of the firm. Strong culture implies less need for other
forms of control. By this employees are self-controlled and it is easy to achieve organizational
goals.

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05.02: Effective control strategies to J.O.C. Company

Personal Control isn’t suitable for J.O.C. Company, because most of the staff is very skilled and
well-experienced. So they don’t want to be monitored all the time. There are some serious
drawbacks. Excessive supervision can stress and demotivate the employees, so turnover rate and
decreased performance can be possible. It reduces the freedom of the employees, so employee
satisfaction and positive work culture is damaged. Once because of the unnecessary interference
of Suzy into Leon’s idea made Leon to drop his morale and motivation, and so his creativity and
new innovations. That made Leon and his colleagues began to consider leaving the company.
And also employees may feel favoritism, personal likes and dislikes. In C.G. Chocolates,
Charlie had a poor controlling system by giving the bonus in an unclear way, and inviting only
some of the employees to play golf. That made his employees feel favoritism and demotivated.
And most importantly this is very costly to the observer. It is very time and attention consuming,
and increases the opportunity cost of the manager. He has to devote the time to observe the
employee behavior instead of planning and making important decisions. Because of that this
controlling strategy restricts the organizational growth and development.
Bureaucratic Control is also not suitable for J.O.C. Company. Because this method reduces the
creativity of the employees and reduces the flexibility. Since J.O.C. is famous for its uniqueness,
it is important to keep-up the creativity and the new innovations of the employees. But when
they have to work under rules and regulations, their creativity in hindered. C.G. Chocolates
maintained a reward and punishment system and believed in a clear chain of command. Mistakes
by anyone in the organization would lead to an angry Charlie confronting the culprit and
threatening them with dismissal or in some cases actually sacking them. That discourage the
employees and they may feel they are not appreciated and dissatisfied. That may lead to increase
the turn-over rate and decreased productivity. And also when the manager takes the decisions by
himself, it reduces the chances of getting more appropriate, more successful and practical
suggestions from others.
Output Control method is somewhat suitable to J.O.C. Chocolates. Output controls are less
monitoring than personal and bureaucratic control strategies. This method is advantageous,
because this let the managers to identify the employees’ capacity, and give a chance to be
creative to get the work done more efficiently and effectively from the employees. The
management team emphasized that quality and the continued success of the firm depended on
everyone contributing as an individual part of the team to achieve targets. This method reduces
the work load Suzy and give her time to make important decisions and make the organization
grow.
Cultural Control is the best controlling strategy for J.O.C. Chocolates. By encouraging self-
control, cultural control reduces the monitoring costs in managing an organization. Adrain

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believed that employees grow into jobs and should be allowed to make mistakes as part of the
learning process. This was helped to increase the team mentality and employees’ trust towards
the employer and company was risen. And Hafiz believed in trusting his team and did not
routinely check progress as everyone knows what is needed. And to emphasis the importance of
everyone working to the same goal, Leon and Hafiz involved staff in new products with blind
tasting, and they were encourages to suggest a name for new chocolates. This helped in creating
a positive work culture. And also employees feel belongingness and they are willing to work and
make sacrifices to their organization. This maintained standards and encourage a positive work
culture of staff development resulting in job enrichment, benefiting the company as staff to
become motivated through work, not just money. And also there were several places where
management get employees ideas and suggestions into consideration. Suzy also asks Leon.
Hafiz, Adrian, Mary and Amina’s ideas before taking an action. That allows employees to feel
like empowered and that they are valuable to the organization. Employee freedom, satisfaction
and motivation is very high. So the creativity, innovations are developed and it is positive to the
development of the organization. Through that the productivity is getting high and organizational
goals can be achieved working as a team.
There are many policies and values that J.O.C. relies on. The organization culture is very strong.
So this cultural control may be the best control strategy to effective management of J.O.C.

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 06 Conclusion and Recommendations.

Joy of Chocolate is basically a gourmet chocolate producing company with a well-qualified staff.
It supplies best quality chocolates to luxury hotels and organizations. Later J.O.C. Company
merged with C.G. Chocolates which helped the growth and development of both merged
companies. In first part it was identified that there are goals were set to different areas, such as
product goals, sales goals, employee goals and customer goals. And there were several number
of objectives which are connected to the goals. And there were some policies which the company
values. These goals, objectives and policies are important in planning and motivating the
employees.
In the second part the formal structure and the nature of the J.O.C. Company was identified. And
it was understood that there might be some informal organizations inside the formal organization
which has a very strong and positive work culture. Then the differences between the formal and
informal organizations were identified.
In the third part the composition of the open system theory was understood. And also J.O.C. also
identified and clarified as an open system which interacts with its external environment in the
steps of inputs, processing and outputs. Then the major two tools of analyzing the external
environment: SWOT and PESTEL analysis were applied to J.O.C. Then the influences from both
internal and external environment on J.O.C. were identified.
In the fourth part different kinds of stakeholders of J.O.C. were identified and they were
classified according to Mandelow’s Matrix to identify their influences towards the business.
There the major suppliers, major customers and the board of directors were identified as the key
players of J.O.C. In the fifth part different kinds of controlling strategies were identified. And to
it was understood that personal and bureaucratic control don’t fit for J.O.C. Then it was
understood output, but mostly the cultural control is the most effective controlling strategy to
lead the business in a self-sustaining way.
There are some recommendations can be used to develop J.O.C.
- They have to maintain the positive work culture and the strong employer-employee
relationship. And also the relationships with the key players should be more important and
strong.
- The business can be expanded globally, exporting their products and introducing their
outlets in different continents can be done.
- And also they can try targeting middle and lower class market other than the higher class.
- The quality and the variety of the products should be raised as to the possible level, and it
is good to find more chocolate related sweets and products other than plain chocolate bars
and gifts.
- Financial management should be well managed, and it’s good to try online marketing,
social media promotions, online ordering and online paying methods.

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