Strategic Review at Egon Zehnder International (A) Harvard Case Solution & Analysis

Strategic Review at Egon Zehnder International (A) Case Study Solution

Elements of Strategic View:

A number of organizations and companies have conducted strategic review to review the financial feasibility, productivity, efficiency, validation and influence on regular basis of any organizational unit at different level (department, office, project etc.). The conduction of strategic review by different firms was primarily to make major decisions in regard to the formulation of strategy in terms of allocation, focus, direction, scope and area.

There is difference between the review of in-depth program and strategic review. As strategic review is to provide way out at the higher level for the strategic question and the organizational performance is considered along with its performance of programs.The designing of strategic review plan can be done in a number of ways to take into account the reason behind why it is conducted and on what basis. Therefore, the strategic review of any organization varies in the same manner. But some of the common strategic review elements are under consideration and needs to be addressed are as follows:

Economics review:

The economic review provides a detailed overview of the underlying economic conditions and organizational factors which includes:

Profitability:

For any organization or business, profitability is its most important thing. This is to evaluate if the organization is generating profit and to what extent. Though, the profit assessment is considered essential in the economics review and for complete strategic review. Detailed analysis of profitability includes profitability by industry, companions, locations and different units etc. This is to estimate the generation of profit and the un profitability by companion, country, industry and department.

Capabilities:

After the profitability determination, there is need to include the overview of network mapping capabilities of the organization. This requires the evaluation of sets of skills, companions, industries, regions and sectors.

VRIO Analysis:

The VRIO analysis of the organization Egon Zehnder International on the basis of its resources and its ability to grow and provide the organization with a competitive advantage, sustainable competitive advantage, competitive parity, and temporary competitive advantage. The important sources and capabilities of Egon Zehnder International include Knowledge, employees, Research and Development, technology, and collaboration.

Although, the organization holds a strong position in the market. There are a number of organizational issues such as the lack of knowledge and investment in bringing advancement in technology tend to be the temporary competitive advantage.

However, the vision of the organization for the upcoming challenges is strong with the strong awareness of brand indicating competitive advantage to be sustainable and strong. Whereas, the collaboration of organization and number of employees demonstrate competitive parity.

Success Factors:

Identification of success factors are one of the important factors of strategic review demonstrating the reason behind the organization’s success. Through the analysis of trends and collection of clients’ perspectives, these can be identified.

• The rigorous process of EZI screening, allowed the organization in finding of right workers and their high retention level assisting the organization to offer its clients with effective performance of consultants to help them in determining candidates for openings of high-level.
• The ultimate and most important factor of the organization’s success is its way of collaboration. The organization is mainly dependent on the collaboration for its effective growth. The collaboration have re-invigorate organization through improvement in retention, employees’ engagement and increased innovation.
• Other success factor which contributed in the success of organization involve research and development. EZI had the capability of research with the availability of consultants and researchers who are accountable for gathering themselves in order to discuss the required organizational abilities.
• The global organizational network works as one unit which increased the likelihood of finding the best candidate and attributed to the system of compensation employed by EZI and the income pooling for all the organizations. (Unknown, 2009)

Porter’s Five Forces Model:

Threat of new entrant:

The threat of new entrant is high due to the reason that the search industry is providing opportunities to new start-ups to promote growth and gain massive profits.

Threat of new Substitute:

The threat of substitute is high as the competitive organizations are providing people with searches based on internet use at reasonable prices.

Rivalry:

Due to increase in the competition and targeting of the organization in the US market, there is a high expectancy of the competition in search industry.

Bargaining Power of employees:

The placement of websites such as Monster.com as the supplier of the organization indicating the bargaining power of supplier to be moderate.

Bargaining Power of buyer:

The bargaining power of buyer is high due to the presence of Egon Zehnder International competitors in the search market which included Russell Reynolds and Spencer Stuart. As the Egon Zehnder International provides its clients with heavy price causing a threat of customer switching to other brands.

Future Investment:

The outcome from the in-depth analysis of strengths, weaknesses, competitive factors and economic conditions of the organization were considered. This determine the areas which require investment and their presentation of pros and cons. However, the organization is leader at global level, the return of profit for last ten years are initiated to be reduced which was the key issue of the organization.

Therefore, the organization is suggested with two alternative. First, the organization should try to cut off the ineffective areas of business which are not generating enough profit and select the target market for the massive generation of profit. Secondly, the organization needs to focus on the provision of services by online means.

Goal Setting:

Lastly, the strategic review should include the goal setting and aims of the organization for both short term and long term benefits. After considering the complete analysis of the organization i.e. conducted in previously. The first strategic initiative that Egon Zehnder International should consider for implementation of second alternative which was to focus on the online platform.

The benefits of this alternative are as follows:

• It is an employee friendly process of hiring.
• Increased use of technology to increase the productivity of recruiter.
• Pre-planned workforce.

Conclusion:

It is to conclude that the development of organization with the concept of executive search. Every consultant had an average of 12 searches a year. Being a leader in executive search, the organization is likely to come across the challenges possessed by the competitor companies. Therefore, the objectives of the strategy and their performance assessment was done through the strategic plan for evaluation of level of performance and area which needs to be improved.The important sources and capabilities of Egon Zehnder International include Knowledge, employees, Research and Development, technology, and collaboration.

The organization is suggested with two alternative i.e. cut off the ineffective areas of business and the online platform. On the other hand, the success factors of the organization included collaboration, compensation system, research and development and hiring process.

Exhibits:

Exhibit –Revenue per consultant in Europe and U.S.

Exhibit –VRIO Analysis

Exhibit – Porter’s Five Forces:

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