Answer To: 54207 by XXXXXXXXXX Submission date: 13-Apr XXXXXXXXXX:48PM (UTC+0530) Submission ID: XXXXXXXXXX...
Sourav Kumar answered on Apr 13 2021
32
Business Model Trasformation through Innovation culture and Leadership in Ship-Management Companies
Abstract
Business transformation is a Paragliding idea for rolling out significant improvements to the way a company or organization operates. Business transformations are powerful, transformative changes that organizations are making over conventional gradual advances to drive change and develop. The assortment, for example, progressing to new business or operating models, is huge and strategic.
Given the intensive investigation of the essayists of the literature, little has been recorded on the internal factors inside the ship management company that influence Business Model Innovation (BMI). This paper is an endeavor to help ship management organizations manufacture a theoretical understanding of BMI. An exertion was made to clarify BMI's current remaining in scholarly literature. Moreover, the examination has grouped internal variables that can put ship-management organizations innovations into BMs. Furthermore, the size and naiveté of the firm are mediating factors that are presented in this BTP. However, literature carries out procedures, entrepreneurship, and innovation to coordinate theoretical development. The rest of the paper unfurls BMI fabricate, research methodology, the setting of the different internal factors and theory creation, trailed by the end, with the audit of the suggestions and characterized holes.
Key Words: Innovation, Leadership, Innovative behavior, Organizational Culture, Business Model Innovation, Ship Management Companies
Structure
This BTP offers an analysis of the ship management companies within maritime market, including the literature part, which includes theories of creativity in the business model, corporate culture and leadership in the transformation. After the literature review, presented a structure in which the researcher has established assumptions about case study results based on the literature that had been reviewed and the analysis of the maritime industry. The scheme has been provided based on the discussion that enabled the study to address the research questions. The survey had also been conducted in different ship management companies, including 28 participants. Later, the topic is addressed where survey preferences concerning the results are explored. Ultimately, it offers closing remarks. Implications for managers have also been presented, and limitations with corresponding implications for future study.
Table of Content
Chapter One: Introduction 6
1.1 Background 6
1.2 Ship management companies 8
1.2.1 History and development 8
1.2.2 Industry overview and trends
1.3 SWOT Analysis 11
1.3.1 Overview 11
1.3.2 Small Size Ship Management Company SWOT Analysis 12
1.4 Aim & Objectives 13
1.4.1 Aims 13
1.4.2 Objectives 13
1.5 Research questions 14
Chapter Two: Literature Review 15
2.1 Business Model 15
2.2 Business Model Innovation And Theory 16
2.3 Business Model Components, and Business Model Innovation Type 18
2.3.1 Business Model Components 18
2.3.2 Business model innovation types 20
2.4 Impact Of Organizational Culture On Business Model Innovation 23
2.5 Organizational Innovative Culture and Transformational Leadership 26
Chapter Three: Research Methodology 29
3.1 Research Philosophy 29
3.2 Research Design 29
Chapter Four: Research Findings 31
4.1. Overview 31
4.2. Understanding Business Models within ship management companies 31
4.3. How to ship management companies innovate their business models 32
4.4. Organizational Innovation Culture and Leadership 34
Chapter Five: Conclusion and Recommendation 35
5.1 Research questions answeared 35
5.2 Recommendations 36
5.2.1 Implications recommendations 36
5.2.2 Managerial implications 37
5.3 Limitations and further research
References 38
Number of Tables
Table 1: Shipping Industry cycles 7
Table 2: Top 10 ship-management companies in 2019 by managed fleet size 21
Table 3: SWOT Analysis 19
Table 4: Business Model Components 19
Table 5: Types Of Innovation 21
Chapter One: Introduction
1.1 Background
The maritime organizations around the world to realign and innovate is constantly growing, owing to the increase in worldwide political risks and technological developments that have both industrial and environmental consequences and stagnating growth (UNCTAD, 2019). According to Jenssen & Nybakk (2009) to handle the changes, cope with increasing competition and to achieve innovations it is necessary to collaborate with alliances. Business models have come up illustrating a new concept of utilizing innovative ideas for enhancing the performance of the companies within the industry. A survey presented by IBM back in 2006 illustrated the benefits of business model innovations, revealing that companies concentrating on such innovation surpassed their rivals. A similar study also made it clear that creating the model of business more innovative can also be a prime tool in fiscal reduction and in enhancing strategic flexibility (Pohle & Chapman, 2006).
The CEO of Wallem Group Mr. Frank Cole in the recent interview with Lloyds list expressed an opinion that the traditional shipping business model is outdated and soon will be replaced by more sophisticated and innovated models that will be presented by the industry-leading companies that are looking for new ways to innovate and enhance their current business models (Meade, 2018). The shipping industry is highly cyclical and operates in various cycles like short, long and seasonal business cycles, further challenging the innovative ideas of the companies (Stopford, 2009).
Table 1: Shipping industry cycles
Source (KPMG, 2018)
Researchers have also elaborated the significance of the intended usage of business models to obtain competitive advantages. Therefore, it is believed that innovative business models are appropriate for maritime companies (Quest,1988 & King, 1970).
The theories that relate to business models and their innovation are still very popular topics of research and widely mentioned in literature below. The business model concepts given to the maritime sector by Fiksdahl and Wamstad (2016) to a massive range addressed to different types of maritime organizations within the industry. Therefore, the link between small firms like small ship management companies and how they innovate their business models with limited resources available yet to be explored. In the research conducted by Fiksdahl and Wamstad (2016) they found that the shipping company’s ability to innovate depends on the resources available which is the case of small size organizations are limited. They also found that the radical implementation of the business model innovations by large enterprises is the most favorable in respect of profitability (Gunton, 1997).
The reason stated by small businesses for not innovating and transforming their existing business models is mostly due to the lack of time, or the lack of qualified employees and resources, while larger companies spend a huge amount of money on their R&D departments and their external consultants to stay ahead of the game (King, 1997). On the other hand, American researcher Kreitner describes the management as the process of working along and by others for attaining organizational goals in a changing atmosphere using the limited provision of resources efficiently (Kreitner, 2003). This research is based on the above insights concerning business model innovation by studying some large industry players and small-medium scale ship-owning and management companies within the Greek maritime sector and will further propose an improvement to the existing business model that will benefit the small ship management companies with limited resources (Gunton, 1997). In addition, because of the absence of existing examination that assesses the connection from the fields of plan of action advancement to conventional plans of action of the little size boat the board organizations I might additionally want to clarify this zone.
2. SHIP MANAGEMENT COMPANIES
2.1. History and development
The ship management industry has been experiencing rapid growth in recent years. In addition to basic ship running and crewing, the range of facilities offers chartering, selling and acquisition, insurance, maintenance of new buildings. Service growth can be attributed to management of ship companies ‘sensitivity to marketplace needs. The rise in the number of facilities has led to shipping management’s growing complexity. This ambiguity gave rise to differing ship management concepts. Both definitions emphasize, however, that managing the ship sells service that is connected both to operation as well as maintenance of a ship that can be provided by an company which is independent. The administration of boats would thus be able to be portrayed as the rendering of administrations identified with the deliberate association of the financial assets (land, work, capital) expected to keep up a boat as a substance gaining incomes. The cost increment in qualified boat the executives administrations came in the late 1960s when oil majors exploited the accessibility of tax reductions on transport venture and put resources into transport procurement assets, assigning the board to outsider organizations. Then again, low cargo costs and the cheapened the mid 1970s selling and buy showcase constrained customary proprietors to offer vessels to their lenders, the banks, who again endowed the administration to autonomous boat administrators. Recognizing the benefits and incentives provided by third-party management, conventional shipowners too had delegated control, further increasing the ship management industry’s viability. An improvement further advanced during the 1980s, when numerous customary shipowners considered boats to be budgetary ventures. In this manner, they were increasingly keen on the selling and buying estimation of the vessels than in the administration of the boats. Designating transport administration to outsider chiefs was a suitable method to focus their consideration on the deals and buying business. Among the components that have been depicted as being fundamentally liable for the boat the board taking off as a help industry are the requirement for proprietors to reduce working expenses and appreciate the monetary favorable circumstances of economies of scale, to hail out existing and new open registers and to access less expensive labor sources. In any case, apparently the inexorably powerful nature of global delivery, alongside the mechanical and business disciplines expected to flourish in it, has held the third boat the executives division going for as far back as decade. Cost-sparing is one of the key purposes behind customary boat proprietors isolated the boat the board to supplant a few or the greater part of the traditional administrative center exercises. This helped transport proprietors maintain a strategic distance from overwhelming expenses, legitimate commitments and claims. Along these lines, transport proprietors sidestep to connection with possession and rise as boat the board organizations. All through along these lines, the industry's covert presence causes vulnerability about the organization's actual character, that is, the boat the executives firms that show up in the catalogs are not outsider boat the executives organizations and not in-house organizations. By the by, it tends to be said unquestionably that the outsider boat the executives part is perceived as a current industry in the sea world, which has requested a piece of the overall industry in the 40 years of its existence with power and achievement.
2.2. Industry Overview & Trends
The ship management sector enjoyed a lot of initial growth, however, the path forward does not seems to be as easy and prosperous as it was in past years. The success of the sector depends on how ship manager and financial owner of the vessel largely (Gunton, 1997).
Apart from this, there are certain major technological concerns of the ship management industry (Gunton,1997), such as technically advanced, computer-based management and maintenance systems. It also includes, measures for fuel efficiency, exchange of complex information among geographically separated offices (Quest, 1988), increased integration of modal with shipping ventures, which constitutes to be an important part of any logistic system (King, 1997), exponentially increasing pressure from legislations related to environment and safety and increased attention towards safety standards and improved quality. Most of the leading ship management companies managed by third parties have realized that dependency on external conditions and factors will not help them anymore to stand in the market. Market growth of the third parties in this sector in the recent times depends on the level of client satisfaction through advantages, benefits, competitiveness and profitability. However, ship managaing companies have to go through a number of challenges as well. Some of the most commonly prevailing issues in this sector are feeling of prejudices and weakened relationship among the ship members due to disbelief, which have an adverse impact on underwriters, characters and owners (Gilbert,H., 1995 Anon, 1992, Ward, R., 1992). Low management fees are another major challenge for this sector. Conflicts of interest have also been observed prevailing particularly in situations where commercial and charting management is undertaken. Professional managers also come across challenges like increased liabilities, insufficient labor and strict regulations.
In this era of cutthroat competition, it is vital for the small-scale ship management companies managed by third parties to focus on an effective strategic management plan that shall assist the business organization to maintain a loyal customer base for a longer period. The plan should focus on improving the relationship between the ship managers and ship owner and should focus on service differentiation. Innovation of the business models is the key that drives success for ship management companies, as this will help them to overcome the challenges. Innovation and creativity will also assist the ship managers to gain competitive advantage over other established and major players such as Bernard Schulte ship management or V-ships in the ship management sector.
Table 2: Top 10 ship-management companies in 2019 by managed fleet size
Source (Lloyd's, 2019)
1.3 SWOT Analysis
1.3.1 Overview
According to Dias (2006) SWOT analysis is a basic instrument of planning which is generally strategic. The expression SWOT is the short form for the terms Strengths, Weaknesses, Opportunities and Threats (Dias, 2006). The first two are variables that can be managed by the program implementing entity, while the later two are external variables, and are not in control of the organization, while some power can be exercised in some situations. About the benefits of SWOT study, various researchers emphasized promoting learning in terms of a situation and the observations on the consequences (Pesonen, et. All 2000). Through using the strengths, vulnerabilities and potential opportunities and threats structures, this tool provides a straightforward method for assessing the best way to formulate strategies (Sammut-Bonnici & Galea 2015).
This technique tells the planners what results are generally obtained and what topics should be considered by them. The SWOT analysis approach is used to understand the existing internal and external climate related to the ship management companies. This research is also carried out to devise plans to improve competitive advantage and the output of the organizations against the complicated changing industry climate. SWOT analysis aims at optimizing strengths and opportunities, mitigating external risks, turning weaknesses into strengths and leveraging opportunities while mitigating all existing vulnerabilities and external threats. The further usage of SWOT is primarily focused on the qualitative as well as the quantitative aspects of internal and external factors, and also competence (Sammut-Bonnici & Galea 2015). A SWOT analysis needs to be adjustable; SWOT analysis is neither simple nor it takes a lot of...