1. Context for the Chosen Topic
Companies employ detailed business plans and strategies in order to gain several benefits from its competitors such as increased profits and enhanced customer relations as company objectives. The application of strategies directed towards the achievement of these objectives naturally requires reviews on the internal operations and general environment of the business organization. In today’s fast and technological modern world, the challenge that the Information Man faces is time’s nature of putting things in order and in place in the best and most effective way. Life has changed since the invention of the computer which dictated man to deal with things in the most efficient way possible. In the world of big international business industries where transactions and other business operations are governed by law, cultural differences and mutual trust, efficiency counts largely as a common entrepreneurial aim.
The modern age of digital electronics made it possible for business and corporate organizations to keep up with the demands of their industries. At present, most business organizations are equipped with the latest information technology (IT) systems that enable them to function fully and effectively. IT has given everyone an opportunity and has provided every person with the ability to communicate and perform tasks which were impossible to do before the arrival of the 21st century. As such, modern information technology has been considered the result of a crucial connection between digital and communication technologies. It has been declared as the fundamental core of an information system, which involves various interactions between data, the users, software, hardware, business corporations and their environment.
Along with these technological revolutions of doing business, human resources managers will have to face new challenges concerning the productivity of each and every employee to sustain competitive advantage. The economy and markets are different from those of a decade ago and as paradigms have changed, the characteristics affecting human resources management must also be revised in terms of organizational structure and functions in order to keep pace with relevant and latest trends and strategies in the international business setting. Most of the successful business endeavors depend greatly on good interpersonal communication and relationship between the service or product providers and their clients. Persuading customers on trying the offered services and products is only a start on putting up a successful entrepreneurial activity. Gaining the trust of the clients and maintaining patrons is very important to ideal business transaction flows to achieve a common goal – that is, continuous profitability.
Research Objectives. Unisys Corporation provides services that are centered on creating secure business environments for its clients. Specifically, its expertise includes consultating services, outsourcing, infrastructure development, producing enterprise class servers as well as systems integration. Among the major markets serviced by the company include commercial, transportation, media, financial services, public and communications sectors. Despite a strong global presence, the firm has been encountering some strategic issues resulting in major profitability reduction. While the company has pointed the decreasing demand for technology as the cause for this problem, analysts have noted that competitors, particularly IBM and Accenture, are the primary causes.
The traditional strategic approaches of the company appear to lack effective, allowing stronger competitors to dominate the industry. In order to ensure continuous progress and more years of successful operations, the causative factors leading to the company’s declining profitability were identified since the identification of the direct causes of this problem can enable the development of new and appropriate business strategies that the company could use. This proposed project mainly aims to investigate the current strategic moves of Unisys and to identify problem areas that cause its profitability to decline. Among the objectives of the study include the following:
1. To address its problem on business competition and develop new and appropriate business strategies for the company.
2. To enumerate the causative factors leading to the company’s declining profitability.
3. To identify whether similar profitability issues and causative factors are encountered by a single company operating in different locations.
4. To concentrate on the profitability status of the Unisys offices from the Greater China Cluster including China, Hong Kong and Taiwan.
5. To develop useful strategic recommendations that would boost the company’s profitability.
The recommended strategies will be based on the analysis of the company’s strategy and survey data. Unisys offices are found in Greater China Cluster including China, Hong Kong and Taiwan. The researcher aims to concentrate on the profitability status of the Unisys offices from these three countries which will be useful in identifying whether similar profitability issues and causative factors are encountered by a single company operating in different locations. The results and findings of the study will hopefully serve as benchmark for the evaluation and assessment of other Unisys offices in other countries in order to enlighten the management of the issues on profitability that beset the company at present.
Since Unisys is a service-oriented business organization that provides technological assistance to other companies through its products and services, its strategic management framework was evaluated as one of the major and primary drivers of competitive advantage in the business industry it belongs to. The researcher hopes to provide useful data and information that may alleviate the issues on profitability that the company faces.
Unisys Corporation. Unisys Corporation provides services that are centered on creating secure business environments for its clients. Specifically, its expertise includes consulting services, outsourcing, infrastructure development, producing enterprise class servers as well as systems integration. Among the major markets serviced by the company include commercial, transportation, media, financial services, and public and communications sectors But despite a strong global presence, the firm has been encountering some strategic issues resulting in major profitability reduction. Since the company is a customer-oriented business organization, it is then important to undertake investigations and studies regarding the human resources of the company as its primary driving force to profitability and success.
For one hundred and thirty years, Unisys has been helping businesses and governments apply information technology to achieve new levels of competitiveness and success. The company’s long history and technical innovation can be illustrated by presenting the infrastructure developments that occurred within the organization for over a century. Unisys Corporation manufactured and sold the very first commercially viable adding and listing machine under the name of American Arithmometer Co. Unisys was also the Remington Typewriter Co. who first introduced the “noiseless” typewriter and the Sperry Gyroscope Co. that manufactured the sell navigational equipment
Along came other technological innovations such as the portable adding machine that weighs twenty pounds, the artificial horizon and the aircraft directional gyro, the ENIAC which is world’s first large-scale, general-purpose digital computer developed at the University of Pennsylvania by J. Prosper Eckert and John Mauchly, the UNIVAC that enabled quick counts of statistical information, the B5000 Series which was the first dual processor and virtual memory computer, the first cache memory disk subsystem, the first mainframe based on complementary metal oxide semiconductor (CMOS) technology (2200/500) under the Unisys name, the first Microsoft Windows 2000 Datacenter Server’s support for 32-processor scalability, and the Intelligent Processing Solutions Limited (IPSL) that positioned the company as one of the major providers of outsourced financial services in the world .
Unisys is a worldwide enterprise with clients in more than a hundred countries. Strong alliances with industry-leading companies allow the company to move quickly and confidently across a full range of advanced technologies and services and deliver solutions for secure business operations. The alliances allowed the clients to achieve exceptional performance, control costs, competitive advantage and effective risk management. The company focuses on the alliances with proven success in helping meet the specific needs of organization’s clients. These alliances include Cisco Systems, Dell, EMC2, IBM, Intel, Microsoft, NEC, Oracle, and SAP Technology .
Moreover, Unisys understands that social responsibility enhances the reputation and strengthens the long-term relationships of the company with clients and partners particularly the communities where it has business operations. The company has earned place in the Dow Jones Sustainability Indexes (DJSI) for four consecutive years recognizing Unisys’ proactive policies in responsibly managing the economic, environmental and social aspects of doing business. Unisys believes in conducting business with respect and concern for the environment by promoting recycling programs worldwide and frequently incorporating recycled materials into in to the company’s products in which more than 24.8 million pounds of obsolete products have been collected and processed since 1997 through Unisys parts-recovery facilities and third parties. Unisys supports diversity councils, composed of employees, whose leadership spans gender, ethnicity and cultures to foster diverse and inclusive environment that maximizes the potential of every employee.
2. Literature Review
Business administration and management characterizes the process of leading and directing the systems within an organization by exhausting available resources extensively so as to achieve the objectives of the business operation. It most of the time includes the conceptualization of business plans and monitoring its execution for assessment and evaluation of the efficiency and effectiveness of the business transactions. Making a business successful in a particular setting demands crucial and detailed studies and examination of the factors that will generate the best results that will serve the aims and objectives of the company. Hence, a shift of focus and interest from the local market to the international setting has demanded innovation not just in corporate leadership as new information, forms of communication, and technology (Kim & Weaver, 2000).
Hardy and Clegg (1996) believe that modern organizations passed by the guild structures and as organizations grew larger, skills become increasingly fragmented and specialized and positions become more functionally differentiated. Multi-business organizations and firms are constantly facing pressures brought about the varying unpredictable factors that hinder efficient and effective business operations. This results to graver responsibilities faced by the business executives as board of directors; capital markets and shareholders push for effective and powerful corporate strategies. As Cohen and Moore (2000) emphasized, a balance between enhanced company processes and renewed objectives should be critically appraised in order to ensure the success of the company.
Competitive advantage. The competitive business environment within particularistic industries intensifies the need of business organizations to diversify the operation systems of the company recognizing the importance of the conglomeration of assets, skills, and capabilities of the available resources that the company has in order to be successful. All these will be realized through the intervention of the corporate parent organization to increase the value of its subsidiary businesses in the international market environment (Jayne & Dipboye, 2004). In this light, owners of big business organizations operating in a competitive business environment should be in constant look out with its competitors and the overall status and events in the industry. Taking advantage of the opportunities and intensifying the strengths while minimizing the risks and weaknesses of a business firm greatly helps in predicting the success in business enterprise (Goshal, 1997).
Most companies find it impossible to create any kind of sustainable competitive advantage based on product alone. It is common knowledge that every one of the successful companies sought and found a precise understanding of how it could create a customer-centered competitive advantage. Hessan and Whitely (1996) emphasized the idea to take advantage of the competitive situation not just by being better in how that product gets sold, serviced, and marketed at the customer interface. It requires that companies create breakthroughs in how they interact with customers, and design a way of interacting that makes an indelible impression on customers, one that so utterly distinguishes them from others that it becomes a brand in itself.
Firms respond to conditions in their marketplaces by modifying their competencies such as internal capabilities and linkages with suppliers and associates and the ways in which they position themselves in relation to their competitors specifically their strategic direction (Beyers & Lindahl, 1999). Each of these components is intricately related and ultimately contributes to firm competitive advantage. The goal is to deliver maximum value for the least possible total cost. Examination on the business strategies and plans in order to answer to the demands of clients and customers through efficient delivery of such needs will not only increase the profit of an organization but will likewise gain the trust and competence of the clients and customers. Moreover, efficient management of delivery options in a particular company and looking into the problems encountered in operating the business may enhance the likelihood of a business corporation to attain its goals as enterprising organization (Porter, 1990).
Similarly, one of the core characteristics of a successful organization is focus. Since the business environments are fast becoming more and more complex added to the fact that it changes rapidly and dynamically, businesses need to concentrate on a few key elements that are most important to their organizations survival. Thus, it is not surprising the critical success factors keep the organizations from straying too far with external issues not relevant to their company’s success. Critical success factors (CSFs) in business, are the limited number of areas in which results, if they are satisfactory can ensure that successful competitive advantage for the company (Thierauf, 2001). Determining these factors is an old concept in business because there were great leaders throughout history who have identified and addressed key factors to achieve their successes. There is no one definition of CSF but it is considered that these are the areas which the company needs to concentrate on to flourish. Therefore, the activities should be carefully monitored and guided by the management.
Chung (1987) defined critical success factors as managerial factors that create a competitive edge for a company in its respective industry. There is no specific process in identifying and executing critical success factors in strategic management planning. This is the reason why Thierauf (2001) asserts that different companies which have similar structure can conduct its market entry forming different strategies which lead to the development of various critical factors. As the primary means for an organization to achieve its strategy, critical success factors must take into account the differences in the environment and organization that exists.
Porter’s Five Forces Model highlights the interplay between the suppliers, buyers, new entrants, substitutes, and industry competitors in order for a business entity to gain competitive advantage. When it comes to suppliers, an organization that offers products as well as services also depends on suppliers that deliver the company’s raw materials. This condition leads to the buyer-supplier relationships within different industries. Such relationship is directly influence by the changes in the supply and demand variables based on the existing needs of the consumer population. The influence of the supplier is defined by its ability to dictate price and influence availability of materials and their ability to (a) increase prices without suffering from a decrease in volume, (b) reduce the quantity supplied, (c) organize in a formal or informal manner, (d) compete in an environment with relatively few substitutes, (e) provide a product/material that is a critical part of the end product or service, (f) impose switching costs on their customers when they depart, and (g) integrate downstream by purchasing or controlling the distribution channels (Porter, 1989).
The power of buyers describes the impact customers have on an industry. When buyer power is strong, the relationship to the producing industry becomes closer to market conditions wherein the buyer has the most influence in determining the price. As such the bargaining power of buyers increases when they have the ability to (a) make agreements with other companies providing similar products and services, (b) purchase a product that represents a significant fraction of the expenses incurred by the company, (c) purchase of a product that is undifferentiated, (d) incur low changes in costs when they change vendors, (e) be price sensitive by bearing in mind the options available, and (f) integration to purchase the goods of the suppliers (Porter, 1989).
Meanwhile, the possibility of new companies entering the industry influences the pace of the competition. Thus, the key is to evaluate the methods of entry and exit for a new player to the industry. Although any company should be able to enter and exit the sector, each industry presents different levels of difficulty influenced by economics. These unique characteristics of the each industry are referred to as barriers to entry which may come from different aspects of the business ranging from supplies to technology. They seek to reduce the rate of entry of new entrants which leads to maintenance of a level of profits for the existing players (Porter, 1989).
“Substitute products” as those that are available in other industries that meet an identical or similar need for the end user. As more substitutes become available and affordable, the demand becomes more elastic since customers have more alternatives. The treat of substitutes often impacts price-based competition since substitute products may limit the ability of firms within an industry to raise prices and improve margins. Other concerns in assessing the threat of substitutes include the presence of new technologies that can contribute to competition though more diverse and economical substitute products and services. A segment is unattractive when there are actual or potential substitutes for a product (Porter, 1989).
Lastly, firms strive to secure a competitive advantage over their rivals. The intensity of rivalry varies within each industry and these differences can be important in the development of strategy. Industries that are “concentrated,” versus “fragmented,” often display the highest level of rivalry. In pursuing an advantage over its rivals, a firm can choose from several competitive moves: (a) changing prices, (b) improving product differentiation, (c) creatively using channels of distribution, and (d) exploiting relationships with suppliers (Porter, 1989).
Understanding the dynamics of the competitors in the industry helps assess the potential opportunities of every business venture by differentiating the similar products or services offered by the company against other business organizations. As such, it is necessary to realistically assess potential levels of profitability, opportunity and risk based on five key factors within an industry so as to determine the long-term profitability of a market or market segment (Porter, 1998). According to Vella and McGonagle (1987) competitive intelligence (CI) is the process by which organizations gather actionable information about competitors and the competitive environment and, ideally, apply it to their decision-making and planning processes in order to improve their performance. CI links signals, events, perceptions, and data that appears unrelated into sensible patterns and trends concerning the business environment to which an organization’s decision-makers act upon. Moreover, public sources are normally used to find and develop information on competition, competitors, and the market environment (Vella & McGonagle, 1987). With regards to ethics CI is legal (Blenkhorn & Fleisher, 2003).
Strategic Management. But the reliance to the external resources of the organization will not do if internal considerations of the company are not likewise considered. These include the significant market characteristics that directly and indirectly influence and dictate the strategic business implementation and sound decision-making from the options available. The forecast of subsequent political, economic, and social implications that change will result to also needs to be identified and enumerated in order to ensure the success and development of the organization and the welfare of the public in general. This highlights the need for strategic management practices within organizations particularly those operating in the international business environment. Strategic management is the process of identifying and enumerating the aims of the organizations in order to come up with sound business policies and plans from which the profit of the business organization will be fully maximized (Appelbaum, St. Pierre & Glavas, 1998).
Total Quality Management is a planned procedure for satisfying internal and external customers and suppliers by integrating the business environment, continuous improvement, and come through with advancement, growth, and safeguarding the cycles while changing organizational culture. Furthermore, TQM is an array of management system throughout the organization, geared to ensure that the organization to continuously attain or surpass customer requirements. Total Quality Management is a philosophy of management that is driven by the constant attainment of customer satisfaction though the continuous improvement of all organizational processes (Robbins, 1998). It is a management philosophy that seeks to integrate all organizational functions such as marketing, finance, design, engineering, production, customer service, and others to focus on meeting customer needs and organizational objectives (Hashmi, 2000).
But along with the changing business world, customers change as well, becoming more demanding and knowledgeable than before. In turn, company management had shifted their focus on their clients or customers so as to stay successfully in business. This transition meant that organizations have to completely reformulate their conventional business aims and purposes from being process-focused to customer-centered. Every business wants to have a regular customer base because customers dictate profits and how the customer is treated will reflect on whether the customers will remain loyal with the company or not. Gaining customer loyalty is also a key corporate challenge today especially in this increasingly competitive and crowded marketplace because of the eventual profitability it will provide (Chow & Holden, 1997).
Business firms invest on researches that will define their target customer groups that they believed they could serve best. Every business person is determined to know what kind of work they would and would not do for their customers and, in turn, they carefully learn how to fulfill the needs of each kind of customer in their target markets. In effect, if consumers somehow become better customers — that is, more knowledgeable, participative, or productive — the quality of the service experience will likely be enhanced for the customer and the organization (Bowers, Martin & Luker, 1990). Rather than going after every potential source of revenue, companies eliminate useless assets that do not add value for customers’ satisfaction. As such, business organizations implement bureaucratic policies and procedures for the benefit of the staff, customers and the company in general.
Service delivery is an interactive and dynamic process that from the consumer’s point of view is much more than a passive exchange of money for a particular service. Characteristics of services (e.g., intangibility, heterogeneity, simultaneity, and perishability) often require customers to be actively involved in helping to create the service value — either by serving themselves or by cooperating and often working collaboratively with service personnel. In high-contact systems customers can influence the time of demand, the exact nature of the service, and the quality of service (Chase, 1978; Lovelock & Young, 1979). In this regard, the company needs to strengthen relationship with suppliers and increase market share. This effort will result to parallel business interests that will contribute to the company as well as the suppliers’ business objectives. Contract agreements and other business transactions should present advantages and benefits for both parties. Efficient delivery of products and services through premeditated and tactical supply chain management initiatives should be prioritized.
A growing number of companies are deploying supply-chain management (SCM) systems to enhance efficiency across the product lifecycle by streamlining procurement, production, fulfillment, and distribution processes. To help ensure that an SCM solution provides the intended return on investment, the enterprise network infrastructure must work together seamlessly since its effectiveness depends on the ability of users to access up to the minute information across the supply chain. The supply chain is traditionally characterized as a stable system in which components and goods move smoothly from supplier to assembly customers. In addition, supply chain refers to the suppliers, distributors, wholesalers and retailers that involved in manufacturing a product and getting it to consumers (Lee & Billinton, 1995). Supply chain is also defined as a network of independent or semi-independent corporation bodies collectively accountable for procurement, developing and or manufacturing and distribution scheme connected with one or more groups of related products (Janyashankar et al, 1996).
However, while the company is capable of providing a budget, the outcomes should be able to recover these allocations in order to prevent capital losses. Thus, the company should employ strategies and create objectives that are compatible to the capacity of the company and what it intends to achieve. As such the company must also be able to determine the concept of Cost Management as an important strategic weapon for a business. External purchases of products and services account for more than 50 percent of total costs (Degraeve & Roodhooft, 1999). Without sacrificing quality, services must create a reliable, cost effective supply chain or operational system to be competitive in the marketplace. Technology has increased the reliability of cost management systems through the use of computer packages designed for specific companies (Anderson & Katz, 1998).
Since management involves the skillful planning and execution of business strategies, it is concerned with creating important decisions that affect the long-term goals of an organization (Gilbert, 1996). Normally, organizations focus on the external characteristic of the business environment. Top management or the stakeholders of the company usually focus on their aggressive competitors and the constant change in supply and demand. However, the internal area in the organization should be taken into account since it is where they get the services or products for the consumers. Areas such as human resource planning, quality assurance and operations management are some of the essential fields an organization should be taken into account during the decision-making process.
Stakeholders are defined as the individuals or organizations which can either gain or lose from the success or failure of a system (Boutelle, 2004). The stakeholder analysis was first introduced by Freeman (as cited by Boutelle, 2004, par.5) to remind management that it is important to evaluate the interests of the individuals or organizations who can influence or can be affected by the activities of the company. The steps to stakeholder analysis are the following: identification of the stakeholders; prioritization of the stakeholders; understand the stakeholders’ perspectives and incorporate the stakeholders’ perspectives to the future plans of the company. The stakeholder analysis is an effective tool in strategic planning because the different perspectives of the stakeholders are taken into account. The strategic plan will then be more likely to achieve the business goals as conceived by the stakeholders, especially those with higher interests as well as higher influence.
Furthermore, according to Hulnik (2002), the private sector intelligence and security is necessary in order for companies to profit for the interest of the owners, shareholders, and mangers. The marketplace intelligence or the competitive intelligence is the most significant area of the private investigation sector that focuses on the knowledge management and information utilization for the benefit of the business organization. The market intelligence has been popular due to the drive of the Society for Competitive Intelligence Professionals (SCIP) to encourage the members of the private industry to make use of intelligence in undertaking their business processes. In this regard, competitive intelligence will contribute to the business decision-making of the stakeholders of the company through access to important information outside the organization.
The current business environment demands the need for newer business systems in the form of business intelligence systems (BISs) in order for business organizations to grow. Business intelligence systems require vision, money, and patience for their development as well as implementation. Business intelligence focus on full understanding of knowledge and information derived from data through effective way of access and synthesis processes using data mining tools. These tools allow organizations to sift through fundamental information for business intelligence use particularly those that provide data about customers, supplier, internal transactions, and other aspects of the business transactions. Data warehouse applications such as catalog, index, and cross-referencing systems are used for the convenient archiving, retrieval and use of collected information. In this regard, basic business data are needed to be transformed into “actionable business intelligence in order to assist decision-makers of the company on what to do (Thierauf, 2001).
Among the information systems that are directly related to business intelligence include (1) knowledge management systems, (2) on-line analytical processing systems, (3) decision-support systems, and (4) executive information systems. All these facilitate comparisons, analysis trends and business patterns, and current and historical information presentation to the decision-makers of a particular organization. Hence, theses systems help decision-makers to make informed decisions that will affect all aspects of the operations of the company by providing thorough information and understanding of its long-term goals and objectives (Thierauf, 2001).
The business intelligence model (BIM) highlights the collection of business information from existing information systems in the operations, work management, procurement, inventory, customer satisfaction, and human resources of the business organization. More than establishing relationships between entities and assets of the company, BIM summarizes and aggregates incoming data for immediate processing to be provided in an accessible format along with numerous and multi-level critical reviews and analyses of the new data to provide in-depth understanding to the people who will use them in the company. The model combines multiple, predetermined data structures and metadata in relational database in which the standardized data warehouse model combines entities, attributes, relationships, and business rules in order to give enterprises ready access to assets, facts, dimensions, events, real time information, and organizational hierarchies necessary to facilitate timely business decisions (Obvient Strategies, 2004).
3. Procedures and Methodologies
The methodology provides information on the description of the methods and procedures that were conceptualized and constructed in order to obtain the needed data and information that will be most useful to the study. Details on how the accumulated data will be analyzed and interpreted as well as how the conclusion will be drawn is discussed in full extent in this section. This provides justification of the means in which the study will be accomplished and at the same time helps in giving purpose and strength to the validity and reliability of the collected information that makes this particular research practice truthful and analytic. Specifically, this research methodology will cover the following discussions: the research design, the methods used in accomplishing the study, the sampling technique utilized, the statistical treatment used, the validity and reliability of the collected data, and the logical and systematic data presentation and analysis.
Research design. This study operated under the quantitative paradigm wherein the survey method will be utilized in order to elicit the relevant information needed to complete research (Frankfort-Nachmias & Nachmias, 1992). Besides, quantitative research plainly and distinctively specifies both the independent and the dependent variables under investigation (Matveev, 2002). It also follows resolutely the original set of research goals, arriving at more objective conclusions, determining the issues of causality and eliminates or minimises subjectivity of judgment (Kealey & Protheroe, 1996).
The research variables were primarily analyzed in order to provide description on the factors that concerns the topic of the study. The variables of the study imply quantitative research wherein the data, situations, or other facts collected will be explained or correlated with other data. Basically, this research based its findings through quantitative research methods because this permits a flexible and iterative approach. Through this method, qualitative elements that do not have standard measures such as behaviour, attitudes, opinions, and beliefs are analyzed. As such, the information that the informants of the study shared to the researcher will be accordingly examined, analyzed and interpreted to answer the research questions presented.
Research method. In order to gather the necessary data, the research employed two research methods – survey and interview. The survey was carried out to identify the possible factors that led to the decline of the company’s profit. The interviews on the other hand, were conducted in order to gain information that the survey cannot provide. These would include data collection and analysis for specific issues faced by the company. The management group and the employees from the company’s strategic and marketing divisions are the target respondents for these processes. As this focus on the Greater China Cluster, Unisys offices in China, Hong Kong and Taiwan will be used.
The survey method was implemented in three successive data collection procedures. These included the pretest of the questionnaire, the actual survey, and the back-checking after the analysis of the data. The pretest of the survey was necessary in order to identify possible shortcomings of the instrument that may hinder the efficient collection of valid and reliable data. On the other hand, the back-checking that was implemented to provide assurance that the results of the analysis are consistent with that of the available information and facts in the field. The researcher gathered secondary data and collate published studies from different local and foreign universities and articles from business journals.
This research project was accomplished by conducting a questionnaire survey using a sample of at least 30 respondents in which inferential statistics was used in organizing and summarizing the findings of the study. Descriptive statistics was used to provide and present the background of the industry in a logical manner. To analyze the findings of the survey, the researcher made use of the Likert rating scale along with computation of the weighted mean of each survey item. The data collection instrument was a structured questionnaire that based on Likert scale. A Likert Scale is a rating scale that requires the subject to indicate his or her degree of agreement or disagreement with a statement. By rating scale we mean the scales that are usually used to measure attitudes towards an object, the degree to which an object contains a particular attribute, (Like or dislike), toward some attribute, or the importance attached to an attribute (Barnett, 1991).
The equivalent weights for the answers will be:
Range Interpretation
4.50 – 5.00 Strongly Agree
3.50 – 4.00 Agree
2.50 – 3.49 Uncertain
1.50 – 2.49 Disagree
0.00 – 1.49 Strongly Disagree
Moreover, the use of survey is efficient since copies of the questionnaire could reach a considerable number of respondents through efficient personal distribution. It will serve as an effective and efficient research tool to elicit and exhaust the information that the respondents perceive regarding the topic of the research project at hand. The questions included in the questionnaire are composed mostly of close-ended queries for easy manipulation of the data during analysis and interpretation. The respondents were asked to fill out the self-administered questionnaires until such time that the researcher was able to complete the number of samples for the study. The researcher will tally, score and tabulate all the responses in the provided questionnaires for the subsequent presentation, analysis and interpretation of the data that were accumulated. Responses from the interview as well as information from secondary resources will be used to support the calculated values.
Sampling technique. The use of stratified random sampling technique was grounded on the need to ensure the represenativeness of the respondents in the survey method. This particular sampling technique ensures the validity and reliability of the data based on the number or quantity of the respondents who filled out the survey questionnaires. Stratified random sampling technique operates by classifying the target population into group classifications as set by the researcher. The samples are chosen through several selection procedures that usually take several stages depending on the complexity of the characteristics of the possible respondents and the interest of the researcher (Trochim, 2001).
Since there is a possibility that several of the accomplished questionnaires will not pass the standards of validity set by the researcher, 5 other individuals who have the same characteristics as that of the defined target samples of the study will also asked to accomplish the questionnaire as reserved samples. Such incidents include half-finished survey form, inconsistent answers, untruthful information and forms of the respondent who did not answer the questionnaire seriously. Upon the completion of the required number of respondents for the survey method, the valid questionnaires will still be included in the presentation and analysis of the findings and results of the study.
Basically, Guilford and Fruchter (1973) initiated that it is advisable to use the Slovin’s formula in choosing sample sizes. Thus, the sample size of the population in this paper was determined by Slovin’s formula. The formula of Slovin is given as follows:
Where:
n = a sample size
N= population size
e= desired margin of error (percent allowance for non-precision because of the use of the sample instead of the population).
Data presentation and analysis. Generally, responses to a questionnaire are objectified and standardised and these make tabulation easy. But more importantly, the respondents’ replies are of their own free will because there is no interviewer to influence them. This is one way to avoid biases, particularly the interviewers’ bias. The answers of the respondents will be first encoded and subsequent tests will be applied to produce quantitative and descriptive data used to complete the research project. Frequency values and percentages of the answers of the respondents compose some of the findings and results of the study.
Percentage – to determine the magnitude of the responses to the questionnaire
n
% = ——– x 100 ; n – number of responses
N N – total number of respondents
The statistical analysis was conducted using Microsoft Excel where the quantitative data are tabulated, graphed and evaluated. The relationships of the variables were then analyzed and collated with other findings of the study. The extent and magnitude of the relationship between variables were presented for the systematic analysis of the collected information. The researcher used graph and charts for data presentation. Tables, on the other hand, are the summary numbers and figures indicated in rows and columns normally used to present quantitative data and results of the statistical tests. Tables facilitated the systematic presentation of all the collected data and information from the survey method. Each table was provided with proper title, number, caption, text and explanation that will comprise most of the results and findings section of the research study.
Validity and reliability of data. Ensuring the validity of the accumulated data is considered to be the most crucial stage of the research endeavor. Since a methodology is always employed in the service of a research question, validation of the inferences made on the basis of data from one analytic approach demands the use of multiple sources of information through validation study built into the design (Kaplan & Duchon, 1998; Foss & Ellefsen, 2002; Mingers, 2001). The triangulation research strategy in which the use of multiple sources to enhance the rigor of the research (Robson, 2002) helps in the in-depth case analysis of the paper. Stake (1995) stated that the protocols that are used to ensure accuracy and alternative explanations are called triangulation. The need for triangulation arises from the ethical need to confirm the validity of the processes. In case studies, this could be done by using multiple sources of data (Yin, 1984).
The data and information gathered in using the secondary data analysis were used to support and rebut the claims of the study wherein critical examination and analysis of the findings were compared and contrasted with each other. The secondary data were critically analyzed based on the credibility of the authors, the methods used and the sampling procedures made in order to accomplish the said previous research studies. Secondary data analysis is composed of the reviews of references and sources in this study to either support or rebut the claims and findings of this particular research endeavor. This enabled the researcher to compare and contrast the results that were accumulated by other researchers who investigated the same topic of research. These include published and available unpublished research studies, case studies, journal articles, and books that have concerned on the investigation and analysis of different concepts, variables and factors that relate to the principal idea of the study’s investigation.
Project Plan
A data or information analysis plan was prepared to organize the information collected orderly so as to make the presentation of the results more comprehensive as well as to make sure that research objectives are achieved and the research questions were answered. In summary, the researcher undergone four major phases to complete the study:
Phase 1: Problem Identification for Research This involves reviewing existing theory, research, and practices from professional literature. This process helped integrate theoretical perspectives and empirical findings with the own understanding of the problem, and discern the aspect of the problem the researcher want to research and learn more about.
Phase 2: Administration of the Instrument. After reviewing literature, the researcher formulated questions for the survey and makes a set of guide questionnaires for the interview. These were then presented to the adviser for validation purposes. After this the researcher initiated a process of building collaborations with the respondents who participated in the study.
Phase 3: Data Collection and Analysis. In the third phase, the researcher collected and analyzed data for the purposes of identifying critical contextual variables specific to their setting. These data enabled the achievement of a specific understanding of the problem.
Phase 4: Data Synthesis and Generation of Recommendations. The researcher synthesized the findings from the previous phases and relevant previous research to modify existing hypotheses and account for different factors that transpired during the analysis, as well as generate recommendations based on new understandings. During this phase, practice-based recommendations for action were generated.
The schedule of activities that the researcher needed to undertake in order to complete this particular research endeavor is illustrated below:
Table 1. Schedule of Activities
Key Activities
Time Scale
Duration
Resources Required
Browse on Related Literature
visit the library, check online resources,
3 weeks
Books, Journals, company documents
consult Unisys for documents
Preparation of the proposal
identification of the strategic problem,
4 weeks
Secondary Resources,
development of research objectives,
Research-writing books
selection of methodology
Development of data-gathering tools
designing of the questionnaire,
1 week
Related previous researches,
development of interview schedule
paper, photocopier, word pad program
Conduction of research proper
selection of respondents, conduction of
3 weeks
Interview and survey assistants,
interview and survey
tape recorder, paper, pens
Data Analysis
computation of survey result, encoding
3 weeks
MSExcel program, word pad program,
interview responses, interpretation of findings,
research assistants, related literature
integration of relevant secondary resources
Preparation of the Final Dissertation
formulation of conclusions and
2 weeks
MSExcel program, word pad program,
recommendations, editing and formatting,
research assistants, paper, printer
Printing
4. Personal Development Plan
5. Findings
China has done remarkably well since the beginning of the economic reform movement in 1978 (Wu, 1996). Between 1979 and 1995, China’s GDP grew at an average annual rate of 9.5 percent. China’s exports grew even faster and China now ranks among the world’s top 10 exporting economies. The government, in implementing the Coastal Economic Strategy, established four special economic zones in the coastal provinces of Guangdong and Fujian and 14 other coastal cities were opened in 1984 to attract trade and foreign direct investment. These economic zones and cities enjoyed relatively better tax treatments and preferential resource allocations (Litwack & Qian, 1998).
Moreover, China’s entry into the WTO will make China’s door even more open. Both foreign investment and foreign trade are expected to increase (Chow, 2000). Foreign firms will begin to penetrate China’s financial and telecommunication sectors. Trade will increase in both directions and Chinese tariffs will be lowered and Chinese goods will have better access to world markets open to members of the WTO. Using foreign competition to stimulate the domestic economy is a major objective in seeking to join WTO, as explicitly stated by Premier Zhu Rongji.
Problems on business competition.
Causative factors leading to the company’s declining profitability. The business offices of Unisys located in the Greater China Cluster has significant decrease in revenue and profit during 2006 compared to the financial report of the previous year. Among the reasons for such decline in profit and revenues were identified as the result of:
1. Unanticipated slippages of key deals
2. Changes in GCI projects implementation schedule
3. Lack of high margin technology products sales from S&T.
The table below summarizes the comparison of orders, revenues, growth margin, SG&A, and profit of Unisys Corporation between the year 2005 and 2006 along with the forecasted accounts for the year 2007.
Table 2. Unisys Corporation Greater China Cluster Operations
From Years 2005 – 2007
2005 Actual
2006 O/L
2007 OP
Orders
123.0
98.0
113.6
Revenue
105.6
89.9
116.6
G Margin
21.5
16.3
27.0
SG&A
19.7
18.9
20.2
Profit
-2.1
-10.1
7.0
GFS. In detail, Taiwan covers most of the Cluster’s financial sector business and is expected to decline in revenue and growth margin for the year 2007 relative to the achievements in the previous year due to lack of large Clearpath upgrade orders and the continuous merger and acquisition strategies between banks which will result to delay in IT purchases. Meanwhile, Hong Kong focuses on the upgrading of ICL check imaging and truncation system along with some enhancement services for existing base. On the pother hand, business in China is mainly on payment, Customer Relations Management and call centre services as opportunities in China insurance and financial institution markets are yet to be exploited. Hence, achieving order and revenue targets heavily relies on early closure of Taiwan upgrade deals while GFS forecast practice services margin improvement with least problem projects is expected to meet risky profit target as dictated by the margin brought about by the changes in the Clearpath sales.
GPS. The forecast reflects closure of several relatively small government projects in 2007 since the Cluster has inadequate local sales resources to support the forward movement of the business. With remote Asia sales support, emphasis will be accorded on China projects that are targeted to have a couple of strategic wins including e-ticketing, thus expecting to achieve the planned revenue and profit along with the Hong Kong Marine project revenue being pulled through since the fourth quarter of 2006.
GCI. The plan is being pulled together from a few of the Transportation projects in China in which the key project is to supply a new Dorado 380 system amounting to more or less 20M to Travelsky to support the expanded passenger load to meet the project completion on year 2008 for the Olympics hosting. The company is at ease with the plan based on the estimation that the Dorado project will generate sell and bill of 20M as well as backlog revenue of 4M from BCIA/Travelsky OMSE services. Meanwhile, the merger of Air China and China Eastern cargo services has delayed the execution of hosting services contract in which the date is yet to be confirmed. Moreover, IBM/Amadeus JV on GDS solution remains a thrust to Unisys while exploring GVC opportunity in Ports need to be considered.
GOIS. Revenue for the year 2007 is maintained flat year on year for the cluster while profit is on the downturn relative to the 2006 achieved revenue and profit goal. Majority of the planned revenue for 2007 is from the recurring businesses that cover CORE, TSM and DTS services as well as some small scale new ITO/BPO projects which are assumed in the plan keeping SG&A at 2006 at level since the plan does not split country projection appropriately to reflect business potential. The marketing partnership agreement with Easipass has been signed and UGSC/MCS has provided low cost offerings, advising further GOIS to stay focused in outsourcing business in the marketplace.
S&T. Meanwhile, the S&T plan has a relatively more aggressive revenue/profit target and is built on the assumption that ES7000 sales, Travelsky Dorado 380, CHB DR, BOC DR will be recognized. It is noted ES7000 margin is inflated and SG&A has increased by 0.8M as compared to the 2006 OL. However, reseller business in China is not convincing as there is exposure of ES7000 sales in the plan and corporate allocations of 15.6M has impacted S&T 2006 results. As allocations were made according to the previous year results, the company expects that by 2007 allocations will not be lower based on the sell of a few Clearpath systems in Taiwan in 2006 and there are risks in meeting the planned revenue and profit. Collaboration with business units on the Clearpath sales and revisiting the ES7000 program are the likely strategies for S&T to maximize sales and lower the profit breakeven point.
Profitability status of the Unisys offices from the Greater China Cluster. Business operations in Taiwan which mainly cover the services business with local banks, the Unisys platform is being used to develop the GFS applications based on customer needs. Mergers and acquisition strategies between banks are likewise expected to continue for the year 2007 which will directly record significant impact on the closure of some of the Clearpath upgrade deals. Existing accounts on the merger and acquisition strategy plan will be proactively continued for a better position in IT purchase from the resulting new banks. The success of the Taiwan Clearing House payment system will be utilized for further business expansion along with the success of the E-Sun Bank call center solution project as well as the exploration of the BPO area with other local financial institutions. Since the Taiwan operations exceeded the 2006 targets, the same will be expected for the year 2007.
Meanwhile the streams of revenue in the Unisys office in Hong Kong are coming from recurring ITO, BPO and maintenance services/TSM & DTS. The GFS sector and operations focus on the application of support services with banks while the S&T sector prioritizes selling products to target accounts which include the Hong Kong Airport Authority and Sun Hung Kai. Currently, the office is at the final phase of closing a system integration project of the very first open source solution in the Greater China Cluster for Sun Hung Kai. Products sales to SHK are likewise expected after closure of the open source SI deal to support the newly integrated system. The SHK deal set a good example on support alignment between business units wherein a SI engagement partner is contracted to oversee the project in order to minimize risks in the course of implementation. Furthermore, a simplified sales model on Unisys coverage is targeted for implementation across the Cluster countries.
With regards to China, it is expected to have a moderate growth in 2007 with which GCI is the main revenue source because the early closure of the Dorado 380 deal for 20M with Travelsky will eventually help China operations achieve revenue and profit targets. A review of S&T and GFS sales strategies is needed to secure closure of deals with target customers while the GPS is expected to record a breakthrough in the government sector.
Key accounts
Travelsky Dorado 380 sale 20M is key to GCI making the plan no., plus OMSE services, this account will bring in some 22M revenue next year. This exclude the ES7000 open bid for 2.9M that we have a fair to close in Q4.
BCIA T3 project implementation is on schedule with expected revenue of some 2.0M for next year based on milestone achievement.
SHK is a system integration project for security related applications development based on J2EE open source. Expect to sign in Q4 for 3.8M covering 18 months project duration.
Air China – contract execution of 10M for provsion of Cargo HIS migration services has been put on hold until completion of cargo merger activity between Air china and China Eatern.
CHB DR system of 5.2M is included in the plan. Working to accelerate project completion to Q4.
Starbucks – sucessful rollrout of managed services in China will lead to hugh business potential yers to comes.
Cluster view/realism on 07 OP
OP realism cluster view comments
Order 113.6 3.0 110.6 China ES7000 reseller program issues
Revenue 116.6 3.0 113.6
SG&A 20.2 0.3 19.9 savings on simplified sales model
Profit 7.0 1.0 6.0 overstated ES and services margin
Similarities in profitability issues and causative factors encountered.
Differences in profitability issues and causative factors encountered.
6. Conclusions, Solutions and Recommendations
Develop new and appropriate business strategies for the company.
Develop useful strategic recommendations that would boost the company’s profitability.
Tighten control on costs
Elimination of problem projects
Simplification of sales model focusing on strategic accounts
Cluster has planned, in accordance with the Asia Pacific directive, trimmed down the organization and implemented an integrated sales model to support the focused accounts.
Credit:ivythesis.typepad.com
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