Running Head: WRITTEN ASSIGNMENT UNIT 4 

Written Assignment Unit 4

BUS 5117

Strategic Decision Making and Management

University of the people

May 1, 2020

 
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In this week's assignment, we should read the case "Restoration Affiliates" (Zuckerman &

Reavis, 2014) and reflect on the challenges of the organization. We should build a value chain of

the organization’s activities and identify the strongest and weakest link. Based on the

information in the case, we should perform a SWOT analysis. Finally, based on our review of the

value chain and SWOT, we should explain what the most important strategic challenge or

opportunity facing the firm is, and we should explain how it could be implemented.

Case description and key issues

Restoration Affiliates (RA) is a collaboration, an equal partnership founded by four

restoration and reconstruction companies in the USA. It is a national network organization that

consists of independent, privately-owned regional companies. ARS, together with three other

companies in the businesses, thought the alliance was necessary for smaller local companies, in

the restoration and reconstruction industry, as themselves to have a chance of competing on a

national platform against such companies as Belfor. Belfor has a national presence and can,

therefore, offer services to clients in multiple cities. The smaller companies were bound to their

region and often did not have all the expertise to take on complicated jobs. To compete with

these national companies, they needed to provide a national solution to clients, and they needed

to address their capacity issues. Both were possible with the founding of RA in 2011. By the year

2013, RA counted 21 member companies with a combined revenue of $300 million. However,

RA faced several challenges that might impede success. The question of who or what body of

decision making was responsible for the equal contribution by members and making sure all

organizations abide by RA's standards of operation was one that needed attention. It was

essential to decide to what degree it was important and necessary to have standards for service. It
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was also unclear who or what body decided which member got the job if more members were

operating in the same territory. And there was the most pressing issue of the need for a referral

fee in an organization built on relationship and a Go-Giver perspective. Despite these challenges,

the founder of ARS is convinced that the alliance is beneficial to all members. RA is is a low-

risk growth strategy, and together they can accomplish what none of them can do on their own,

which is to provide customers with a national solution.

The value chain

The value chain model describes the activities needed in a company to develop a product or a

service. The term value chain is because after each step in the chain is completed, the product

increases in value relative to the previous step. The value chain aims to increase efficiency and

quality and lower costs (Fleerackers, 2010). The activities are divided into primary activities and

support activities (Ketchen & Short, 2012). The primary activities are those actions that directly

contribute to the creation and distribution of goods and services and include inbound logistics,

operations, marketing & Sales, and (customer) service. The secondary are the processes that

make the primary activities possible and include firm infrastructure, human resource

management, technology, and procurement.

Primary activities

An RA member is commonly contacted by an insurance company or a property manager

when a property needs to be restored. The inbound logistics are the referral of the member

company that is more suited for the job and falls within the region. The gathering of the adequate

and necessary equipment for the job/project. Operations is actually to complete the job according
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to the industry standards. Also getting the help in equipment or knowledge from member

organizations. The outbound logistics would be completing the project in time and agreeance to

the customers' requirements. A warranty can be part of the completion. Marketing and sales

should highlight the benefits of enlisting a member of the alliance, which is the combined

knowledge and expertise of all the individual members. Service is the guarantee that no matter

which member executes the job, it can always guarantee the same level of quality (Zuckerman &

Reavis, 2014).

Secondary activities

The infrastructure of RA is established in a limited liability corporation (LLC); this

means that all members are equal shareholders and have equal responsibility. The board of

directors, consisting of nine persons, manages the RA's business and affairs. Owners and

executives of member organizations are expected to participate in one or more of the standing

committees (Zuckerman & Reavis, 2014). Human resources management (HRM) is not

explicitly mentioned, but one can assume that each member organization is responsible for its

own HRM. RA is yet to develop a system for communication, and for tracking jobs, this is part

of the technology to make RA successful. However, RA is promoting disaster planning software

to its customers. The software offers a digital blueprint of a property with detailed information of

the properties they are working on. Procurement was the responsibility of each member to

negotiate the best price with suppliers for themselves and their referrals (Zuckerman & Reavis,

2014).

SWOT Analysis
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A SWOT analysis is a tool to get an overview of the strengths, weaknesses, opportunities,

and threats of an organization. A comparison of the internal and external factors can help an

organization generate ideas for success. A SWOT analysis is a brainstorming technique and not a

tool to formulate strategies (Ketchen & Short, 2012).

Strengths Weaknesses

 RA provides service nationwide  Disagreements between members

 RA is built on trust and transparency  Members that do not adhere to
 Members are equal shareholders and policies and standards
share responsibilities  Lack of a sophisticated internal
 Members had diversified knowledge communication system
and expertise and can support each
other
 RA is reachable 24/7
 Guaranteed level of quality
independent of member
 Work nationally
Opportunities Threats

 Interest in the disaster planning  Customers prefer to work with a

software company that they already know
 Customers have the choice of  Competitors offering better prices due
contractor to economy of scale
 Insurance companies prefer to work  Big companies also formed alliances
with one provider
 National company with local expertise

(Zuckerman & Reavis, 2014)

Strategic Challenge and Opportunities

The most important strategic challenge for RA is to get its members aligned with the

roots of its foundation. There must be clarity in communication, referrals, adherence to

standards, policies, and procedures. In short, members should agree on the internal processes of
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the alliance to provide and guarantee a certain level of quality to customers independent of the

member executing the job. RA needs to develop further a strategic communication plan and a

management information system to keep track of jobs, referrals, and other processes relevant to

the organization. The St. Louis firm contracted should be concerned with formalizing internal

processes. The strategic opportunity is in the offering of diverse local expertise on a national

level and the ability to get support in people and equipment form other member organizations.

RA should concentrate on its founder's motto, which is “giving without expecting anything in

return” (Zuckerman & Reavis, 2014, p. 1). This means to strengthen their union in trust and

transparency.

Conclusion

RA, as an organization, has a lot of potential for being a successful national competitor.

All members need to acknowledge their shared responsibility and recognize that their success is

dependent on each other. It is only as a group that they can achieve these results. The

organization still has some issues to work out, and that is understandable for an organization that

has grown so much in such a short period. If RA wants to compete with industry giants as Belfor,

it has to profile and perform as one.

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References

Fleerackers, T. (2010). Case: Amazon.com. Retrieved May 23, 2016,

from https://flatworldbusiness.wordpress.com/flat-education/intensify/creating-a-flat-

business/case-amazon-com/

Ketchen, D & Short, J. (2012) Strategic Management: Evaluation and Execution. This book is

licensed under a Creative Commons by-nc-sa 3.0 license.

Zuckerman, E. & Reavis, C. (2014). Restoration Affiliates. MIT Sloan School of Management.

Retrieved from: https://mitsloan.mit.edu/LearningEdge/strategy/RA/Pages/default.aspx