The topic of sustainable development has received much public interest from the public in the recent past. The ability of a firm to remain relevant in the market depends on its efficiency in handling the social, governance, and environment issues that affect its performance. Although the fundamental goal of many companies is to maximize shareholders wealth, it is impossible for an entity to achieve such targets with proper attention to sustainable method. Sustainability is key to continue profit-making in a firm, and thus, the management should take the necessary actions to achieve sustainable growth. Michelin Tire is an organization that has great concern for its ES&G issues since its management is aware of the importance the concept has in the success of the entity. Recently, the organization has faced many challenges in sustainable actions and thus the need to evaluate the current situation to recommend essential changes. The paper will analyze the issue in the coming to come up with appropriate solutions to maintain competitiveness in Michelin Tires.
Mission and vision
Michelin Tire Limited has clear guiding strategy statement that has to ensure that firm remains competitive and allow efforts are directed toward achieving the entities objectives. Without clear policy framework, the business will have diverse attention making it hard to achieve the corporate goal. The vision if the entity is to become a global leader in the tire industry by offering quality products in an environment sustainable manner. The target is to be realized through recycling of waste product and efficient processing of secondary raw materials to achieve fine rubber granulates. The mission is to satisfy all the stakeholders in the entity by ensuring that their aims are satisfied. Application of environment principles will protect the community from pollution while quality products will serve consumers better committed to rivals. Michelin Tire is suitable for the study due to its regional and intentional participation in sustainable trade.
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Internal and global challenges
Competition remains to be the most crucial challenge that ventures experience this call for proper solutions to re-address the problem. Also, poor management of the business has its consequences on the progress of the firm or its failure. The need to exploit the market, many companies, dealing with tires are popping up in high rate posing a challenge to Michelin Company, which dominated the market. The Michelin Company established many terminals as it tried to reach out to its customer. As a result, they had to enrol more employees in their company. However, the company uses more funds on the maintains and its development. Due, to the establishment of the new ventures in the market producing tires Michelin Company, lost its shares in the market, and this led to a loss of profit in the company. The company has to evaluate the challenges for it to be able to sustain its changes it the company and its environment.
Changes and the cost of change
A change in the venture has to be done each and every minute when a company notices any new threat in the market. The Michelin Company faced the managerial problem, and this called for changes on how it established its new ventures and how it enrolled its employees. The management of any enterprise is very crucial as it determines the profit of the venture ( Kashmanian, Keenan & Wells, 2010). The Michelin Company also need to do more research on how the market is changing to understand the likes of the costumes for it to maintain its shares on the market. As much as it would require more many to make this changes, this will cause the company go back to its position. Consequently, the company will make more profit and sustain its changes will not be a challenge.
Monitoring sustainable actions
Michelin Company keeps track of its environment, governance, and community performance by use benchmarks from the set market standards that allow the company to compare their performance with that of competitors. Customers are willing to deal Harb or with businesses that comply with sustainable regulations as they contribute to the wellbeing of stakeholders. Agencies that deal with non-financial ratings are used in measuring and monitoring the sustainable actions of Michelin Tires. Indicators in all the area of ES&G issues are used to evaluate the extent to which the entity has achieved. Satisfaction from clients is also used as a base for establishing whether the actions have made their purpose ( Harbi et al., 2015) . The operations of the entity are continuously compared to the set governance rules to ensure that deviation does not exist, and any variations are corrected on time. The increase in some complaint in a certain line of product or service is seen as an indicator of poor performance, and necessary action is taken to solve the situation.
Financial programs and tools
Michelin applies the bottom line concept in the management of evaluating its financial decision. Integrating all the aspects of the firm including social, environment and governance issues helps to create a full picture of the entity. The progress made is analyzed on customer satisfactions and their feedback on various areas in ES&G. Ratios are effective financial tools that can be used to determine the performance of an entity and identify the area of weaknesses. Using ratios helps to classify an entity based on liquidity, equity, and leverage and this contributes to indicate the various amount available and allocated the serve in community function as well as maintaining the environment ( Goodman, 2005 ). The equator principle programmer is applied in determining the effectiveness of the firm in attaining its target based on the set framework to guide on ES&G issues.
Recommended changes
Lack of sufficient funds to participate in effective sustainability projects limits the participation of Michelin Tires in such activities. The mission of the Michelin is to improve global mobility to helps individuals and companies in realizing their potential. Therefore, the changes made should be in line e with set objectives. Streamlining the management is a crucial shift that must be effected to avoid pitfalls in the decision making and the implementation process. Employing of experienced executives will aid in making of rationales decisions that will include cutting on the number of branches and instead enter into their intentional market other strategies such as franchises, mergers and acquisition ( Summers, 2001 ). Sourcing of cheap raw material and effective recycling will help in meeting the customers’ demands of low prices without compromising on quality.
References
Harbi, S., Margni, M., Loerincik, Y., & Dettling, J. (2015). Life Cycle Management as a Way to Operationalize Sustainability Within Organizations. In Life Cycle Management (pp. 23-33). Springer Netherlands.
Goodman, M. B. (2005, July). Meeting the global challenges of the contemporary business environment. In Professional Communication Conference, 2005. IPCC 2005. Proceedings. International (pp. 11-19). IEEE.
Summers, M. D. (2001). The role of leadership in successful vocational initiatives. New Directions for Community Colleges , 2001 (115), 17-25.
Kashmanian, R., Keenan, C., & Wells, R. (2010). Corporate environmental leadership: Drivers, characteristics, and examples. Environmental Quality Management , 19 (4), 1-20.
