Introduction
The analysis of the activities of a large organisation may allow assessing its success and failures in external and internal operating environments and identifying the key factors that affect the specifics of its work. As an object of evaluation, Ashghal will be considered, the Public Works Authority, which is located in Doha, Qatar and is involved in the regulation of all construction projects in the country. Regarding the legal form of its business, Ashghal is a non-profit organisation that reports to the government. This form is convenient for interacting with different market participants and allows implementing planned projects based on the ready budget but not incoming gains (GSK 2018). Ashghal’s purpose is to manage and coordinate the construction of public infrastructure, including control over planning, design, asset allocation and other significant tasks (Ashghal 2020a). It was founded in 2004, and since then, due to a well-structured corporate strategy, the organisation has established partnerships with enterprises both inside Qatar and abroad (Ashghal 2020a). This has made an essential contribution to the development of the state infrastructure.
This large organisation has individual programmes and specific development plans. According to the official report, Ashghal’s mission is to constantly increase customer satisfaction through competent asset management and timely innovative solutions (Ashghal 2020a). The organisation’s vision is an opportunity to provide professional services to monitor the development of sustainable infrastructure (Ashghal 2020a). Finally, Ashghal’s objectives include focusing on the quality of work, growth opportunities, achieving adaptability, honesty and learning dynamics (Ashghal 2020a). All these features of planning activities in the market are taken into account in order to implement the tasks set productively.
In order to assess the activities of Ashghal in the domestic market of the country, a special analytical tool may be utilised. As this, the PESTLE analysis is proposed to apply, the methodology offering the criteria that affect the specifics of business. Rastogi and Trivedi (2016, p. 385) interpret this abbreviation as “political, economic, social, technological, environmental and legal factors” that affect organisational activities. As Senouci, Ismail and Eldin (2016) note, Ashghal’s data are publicly available, and relevant information on production volumes and pace of development may be obtained freely.
Political factors play a significant role in Ashghal’s activities since the organisation is accountable to the Qatar government and is involved in projects approved by the authorities. For instance, the upcoming FIFA World Cup of 2022 is an event coordinated by relevant supervisory boards, and the agency reports on the work done at the international level. Regarding economic factors, Ashghal’s work is also limited by financial parameters. The situation in the domestic economy largely determines the validity of construction projects, their estimates and other indicators. Therefore, the more sustainable this industry is, the higher is the likelihood of the stable employment of Ashghal’s specialists.
Social factors determine the activities of Ashghal in the domestic market less significantly than the two previous ones. However, when analysing the existing trends in the modernisation of urban infrastructures, one can remark that the movement towards innovation is perceived as an integral element in the development of the country’s image. In addition, such parameters as population density, income levels and other social aspects affect the nature of the activities of construction organisations, including Ashghal (Rastogi and Trivedi 2016). Technological factors are an important aspect that needs to be taken into account when drawing up short and long-term development plans. For Ashghal, the possibility of using modern developments in the construction industry opens up significant development prospects and determines its production performance. Innovations that emerge in the international construction market influence the agency’s activities and encourage it to strengthen the available resource base.
The following factor included in the PESTLE analysis is a legal one. Based on the existing juridical provisions, the activities of Ashghal, as a non-profit organisation, are regulated by relevant standards adopted in Qatar. In particular, safety standards, labour laws and other mandatory conditions govern the agency’s responsibilities, and when involved in projects outside Qatar, the organisation has to follow local legislation. Finally, environmental aspects should also be taken into account since a geographical location, ground features, the availability of water resources and other similar factors, in many respects, influence the specifics of building activities. International trends to follow green production are to be respected, which determines the company’s move towards environmentally friendly projects. All the aforementioned aspects affect the work of Ashghal and are significant drivers to evaluate, particularly political and economic criteria due to the importance in relation to the construction sphere.
Task One
Since Ashghal is a public agency accountable to the government, it does not face the need to find partners domestically. However, in the construction industry in which the organisation is involved, the level of competition is high. Qatar is developing dynamically, and many interested parties are ready to offer their services to expand the sphere of influence. According to Shoeb (2018), a trade and economic blockade imposed against the state by a number of the GCC countries in 2017 increased competition in the local construction market of Qatar. The search for new opportunities for building partnerships had a positive effect on the industry, which, nevertheless, entailed risks for Ashghal in view of a greater number of new companies. Alagos (2018) notes positive changes and mentions healthier competition resulting from sanctions. Thus, along with other organisations, Ashghal is forced to build a sustainable strategy to overcome this barrier. As a model to assess the competitiveness of this agency, Porter’s five forces analysis will be applied. This methodology makes it possible to evaluate the basic characteristics of any business from a competitive perspective and demonstrates the most vulnerable areas that require intervention.
The applied estimation algorithm includes five elements, or forces, which determine the success and failure of competition in the market. Bernardino et al. (2018) research the issue of managerial challenges in Qatar and state that, in addition to standard risks, for instance, buyers’ power and threats of substitutes’ activities, more competitive drivers should be mentioned. In particular, the authors state that the “power of suppliers, industry competition, and impact of new entrants” are crucial indicators determining performance and recognition in the market (Bernardino et al. 2018, p. 231). Ashghal, the organisation that provides construction services, should take into account the aforementioned risks to prevent a decrease in the sphere of influence and the loss of a leading position among companies in this profile.
Industry competition is the force that drives Ashgal’s managers to improve the organisation and create new opportunities to meet consumer needs. The environment in which the company operates contributes to implementing innovative approaches and technological developments in its activities. Moreover, these practices can be combined to achieve the highest productivity and gain customer loyalty as a significant evaluation criterion. As a result, this parameter may be addressed successfully in case of corresponding changes aimed at optimising the work process.
The power of suppliers is a driver that can also affect the dynamics of competition. As Bernardino et al. (2018, p. 233) argue, a supplier can “improve the input factor price and reduce the unit value quality”, which will affect the activities of partner organisations using its services. For Ashghal, the purchase of large building consumables and other components means working with different suppliers. Concessions towards each other and a favourable environment for communication are the factors that strengthen the mechanism of mutually beneficial partnerships and stimulate income for both interested parties. More assets are saved, which, in turn, allows utilising the available funds for more important and urgent tasks and avoiding the suppression of business by competitors.
The power of buyers is a factor that affects Ashghal’s activities to a lesser extent since the main task of the organisation is the construction of public facilities. Ordinary consumers can appreciate the company’s success in building urban infrastructure, but interaction with the government is the key direction that the management of the agency aims to develop. As a result, stability and performance are valuable criteria for recognition and regular orders.
The threat of substitutes is more significant due to evolving technologies and other companies’ ability to provide construction services in a shorter time or due to more innovative methods. Ashghal has high production potential, but for other organisations, an opportunity to earn a leading position in this industry is an incentive for continuous development. Therefore, the company risks losing recognition if it is unable to maintain the work process efficiently and rationally.
Finally, the threat of new entrants is a force that Ashghal’s management should consider when planning work activities. Along with the industry competition parameter, this indicator can change the alignment of forces in the market design and redistribute the load on the parties involved. The organisation should not allow young companies to have greater production potential. Thus, the forces of substitutes, rivalry and suppliers are the most significant aspects that are important for Ashghal regarding its market success. Work in the construction field is convenient for innovation, and continuous development is a prerequisite for leadership.
Task Two
Interaction with interested parties is an important aspect of the activities of any enterprise providing public services and involved in large-scale projects. Ashghal has an extensive contact base and has to adapt successfully to communication with various market participants in order to remain a sought after company. In this regard, the stakeholder theory may be applied as an instrument to assess the importance and convenience of following a clearly strategy of interacting with various interested parties. Jones, Harrison and Felps (2018, p. 371) note that this tool helps evaluate “the performance consequences for firms of highly ethical relationships with stakeholders characterised by high levels of trust, cooperation and information sharing”. In other words, the significance of cooperation with different interested parties is reviewed and interpreted, and specific conclusions are made based on this analysis. The theory in question contributes to utilising relevant changes aimed to optimise the work process. Managers can apply this concept to analyse the effectiveness of cooperation and make appropriate amendments if needed. In the case of Ashghal, specific interested parties and their roles should be analysed, and the power-interest matrix may be used for this purpose.
Firstly, a list of stakeholders needs to be defined in order to obtain an idea of Ashghal’s spectrum of communication channels and evaluate their roles in the organisation’s activities. According to Meyer and Kara (2020), since the agency is involved in a number of construction projects, there may be more than ten internal interested parties for each of them. In particular, these are departments regulating the work in various directions and sections that aim to solve the immediate tasks based on the existing human resources and financial assets. The number of external stakeholders is significantly higher; as Meyer and Kara (2020) state, there are no less than thirty interested parties whose activities are crucial to take into account. These stakeholders have different work objectives and degrees of influence, but most of them relate to governmental affairs. Ministries, local authorities and other public organisations are parties that have an influence on the work of Ashghal. The aforementioned power-interest matrix may be utilised to evaluate how specific stakeholders are important in the context of their impacts on the considered agency and what benefits Ashghal can achieve while cooperating with them.
This matrix includes two basic dimensions – the power to influence stakeholders and the degree of interested parties’ interest. In Figure 1, the scheme is demonstrated of how this algorithm is achieved (The Project Management Blueprint 2019). The movement towards more stable correlations is achieved through the active participation of both parties, and corresponding motives are to be taken into account when analysing the indicators of influence and interest.
Regarding the importance of internal stakeholders, informing the departments of the organisation is an important aspect of maintaining a productive work environment. Despite the fact that their power is less significant than that of external participants, Ashghal’s units and sections are interested in functioning efficiently and achieving the highest possible production results. Yu and Leung (2018) argue that interests are equal to needs and note that all the participants who are dependent on the success of activities are sufficiently motivated to demonstrate high performance. In relation to external stakeholders, their powers are weightier than those of internal ones, but their interest in supporting Ashghal are less manifested. In the construction market of Qatar, different firms and companies are represented, which provide infrastructure modernisation services. In this regard, despite the success of Ashghal, the authorities do not have an urgent need to promote this organisation, but their power is sufficient to influence and coordinate its activities. Therefore, both categories of stakeholders are important members of the work process of the agency in question.
With regard to potential conflicts that disagreements with stakeholders may cause, different approaches need to be promoted. For instance, internal interested parties may be dissatisfied with the degree of involvement in organisational operations. To resolve this situation, Ashghal’s management needs to interact more closely with the staff and provide employees with an appropriate knowledge base to obtain all the necessary information. Conflicts with external interested parties may be based on legal or trade-economic aspects of activities. In order to avoid dangerous disagreements and the termination of operations, Ashghal’s managers need to promote a system of stable reporting and work within the framework of available authority. This will help overcome conflict situations and provide support from supreme supervisory boards that coordinate the work of the organisation.
Task Three
The analysis of Ashghal’s activities enables to assess the national economic system of Qatar and draw appropriate conclusions regarding the key trends that are promoted both domestically and abroad. Based on reliable data, the country is in 31st place in the world in the context of business freedom, and in its region, its place is third (The Heritage Foundation 2020). These indicators are high in order to assert a fruitful environment for the development of entrepreneurial activity and interaction with various stakeholders. Nevertheless, the government’s participation in the regulation of certain aspects, in particular, public subsidising and distribution of budget funds, leaves an imprint on the state’s economy. The emphasis on the oil and gas industry is due to the country’s significant reserves, which it began to accumulate in 1971 after receiving independence (The Heritage Foundation 2020). As a result, the macroeconomic nuances of the state development are largely based on trade in these natural resources. At the same time, the activity of private enterprises is permissible and does not contradict with the law. Thus, the state has a mixed type of economy, which involves the authorities’ participation in the regulation of individual industries.
This type is a system that includes both the private sector and active state participation in the economy, reflecting the characteristics of the market and planned models. Fedele and Depedri (2016) characterise such an economy as an environment in which private and socially oriented businesses interact and contribute to replenishing the state budget. According to the official information, Qatari financial institutions run by the government have to control the costs and profits from foreign partners due to the blockade against the state by the GCC countries (The Heritage Foundation 2020). Therefore, the mixed principle of organising financial and economic activities is advanced. Fedele and Depedri (2016) call the sustainability of non-profit organisations one of the main advantages of this type of economy. These enterprises have the freedom to choose markets and can count on state support. In addition, the authors note the various stakeholder benefits achieved by following this development programme (Fedele and Depedri 2016). Organisations operating in a mixed economy have an advanced communication system among the parties involved, which, in turn, has a positive effect on addressing the current challenges and issues of the country’s internal growth.
The aforementioned merits reflect the convenience and benefits of following the mixed principle of economy promoted by the Qatar government. Nevertheless, some negative aspects of adhering to this course may also occur. Fedele and Depedri (2016) note that a country that encourages government intervention in the business sector may have difficulty entering new markets. For instance, due to the trade sanctions that the GCC imposed on Qatar, it is challenging for the country to maintain relations with partners in the sale of oil, which is a key area of its activities. For Ashghal, such a result means that the state coordinates any construction projects thoroughly, and increased control by the tax authorities is common. Another potentially negative result of a mixed economy is a financial gap among population classes, which manifests itself in poverty. However, in Qatar, this outcome does not appear, which means a competent policy of budget allocation.
In such circumstances, the government sets specific macroeconomic objectives aimed at strengthening the local financial industry. In particular, Fouejieu et al. (2019) cite the goal of sustainable economic growth as a significant and priority task. At the same time, such an objective pursued by the government of Qatar is reflected in the activities of Ashghal. The organisation receives appropriate support and has an opportunity to act as an enterprise counting on interaction with foreign partners. The contract for the renovation of the infrastructure to prepare for the FIFA World Cup in 2022 confirms the course to expand possibilities of economic growth.
Another macroeconomic objective that the Qatar authorities adhere to is full employment, which is an indicator of the country’s stable market position. As Fedele and Depedri (2016) state, maintaining equilibrium in the labour market may be disrupted in conditions of a mixed economy, which the government promotes as the main course of development. However, based on the employment of Ashghal’s employees, the organisation has no difficulty providing jobs. The agency attracts partners to establish a hiring system, and appropriate measures are taken, in particular, following the employee welfare program (Ashghal 2020b). The labour market is not overloaded, which allows arguing about a competent policy of providing jobs and preventing the development of the negative consequences of a mixed economy.
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