Technology, Innovation, and Corporate Social Responsibility

Executive summary

Until recently, business were managed with an ultimate aim of making profits and businesspersons made little or no attempts to preserve the environment in which they operate or meet expectations of the society. It is in the last two decades that issues of corporate social responsibility and sustainability have gained recognition. Today, use corporate social responsibility and sustainability to leverage their competitive advantage. and seek business dissertation help. Additionally, business today rely on technology and innovations to promote their performance and stand against their competitors. This report is designed to discuss the concepts of technology and innovation and their application Royal Mail Plc. In addition, the paper analyses Royal Mail’s approach to corporate social responsibility while debunking the concepts Archie Carroll’s pyramid model. The results indicate that Royal Mail Plc has actively engaged technology to innovate its services, which has played a significant role in the company maintaining its market share. The results also show that Royal Mail PLC observes the four dimensions of Carroll’s pyramid model namely economic responsibilities, legal responsibilities, ethical responsibilities, and philanthropic responsibilities.

Introduction

Until recently, very scarce literature focused on environmental and social challenges that face the business world. Much of the focus was on market sustainability and profit maximization. For example, Pedersen et al. (2018) notes that the understanding operationalization of sustainable development and understanding of sustainable business models is very weak. Similarly, Demirel and Kesidou (2019) state that business literature is yet to address the aspects of business models and corporate sustainability. However, over the recent past, there has been an increase in the number of studies focusing on corporate sustainability (Schaltegger et al. 2011). It is in such literature that concepts such as social business models, triple bottom line models, green business models and community development business models are evident. Such models seek to link business practices to the society (Sun et al, 2019). Despite the shift in business literature, innovation remains a central theme in the current business literature. According to Schaltegger et al. (2016), innovation as a major contributor to economic development should include social improvement in its objectives. Likewise, García‐Piqueres and García‐Ramos (2019) write that innovation and corporate social responsibility are central to realisation of sustainable development in the current business environment. Eco-innovations are among the strategic agendas that organisations are embracing in order to reduce their impact on the environment (Ganda 2019). The aim of this paper is to explore the effect of innovation and technology on business performance and to discuss the importance of corporate social responsibility of organisational operations drawing from Carroll’s pyramid model.

Task 1

A: Types of innovation and technology and their effect on the economy

Innovation refers to the process of making something new (Kopcha et al. 2016). Likewise, Baporikar (2014) defines innovation as the use of new administrative and technical knowledge for offer new products and services to customers. Technology is a driver of innovation and the result is technological competitiveness which differentiates a firm that uses technology to innovate its products and services from the one that does not (Baporikar 2014). Garcia (2015) identifies five types of innovation namely new products, new production methods, exploitation of new markets, new ways to offer products in the market, and new ways to organise a business. All these innovations have a certain degree of novelty whether technological or non-technological. This novelty is a distinctive feature of innovations. On the other hand, Kopcha et al. (2016) identify four types of innovation namely incremental innovation, disruptive innovation, architectural innovation, and radical innovation. Incremental innovation uses a firms existing technology to add value to customers. Disruptive innovation applies new technology or process to a company’s current market. Architectural innovation uses existing technology in a new market. Radical innovation gives birth to new industries and creates revolutionary technology.

Innovations and technology are among the key drivers of economic growth. For example,

Online shopping and e-commerce have opened up stores to more customers increasing sales revenue.

Low cost carriers have increased the number of people travelling by air resulting to an increase in GDP.

Computer-assisted technologies have made business operations easier and faster resulting in higher profit margins

Agri-tech has resulted in new ideas, processes and techniques to respond to challenges in the agricultural sector resulting in higher revenue

Innovations in health sector such as electronic health records have resulted to higher quality outcomes reducing the amount government spends on health and social care.

Business organisations use new technologies differently to enhance their performance. For example,

Firms are using internet to better connect with their customers. Today, every business has a website and practice social media marketing to promote its products to consumers while collecting information about its products and services

Organisations have used computer networks to allow their employees work from home and other places away from the office

Organisations use technological innovations to create a more favourable working environment. Such technologies include room heaters and cooling systems to ensure temperatures favour employees

Technological innovations have also changed the way organisations produce their products. Recently, Agile productions methods have gained popularity in business firms with an aim of better meeting the needs of the consumers.

Global companies use teleconferencing to connect with employees from different countries which has made meetings easier.

B: Effect of innovations and Technology on Royal Mail PLC

Royal Mail plc is an international business, developing a modern, optimised and efficient network to deliver letters, parcels, and new products (Royal Mail 2017). The company operates in 44 countries and nation states across the world; 41 in Europe and eight states in Western US and Canada (Royal Mail 2017). Royal Mail is a digitally innovative company connecting customers, companies and countries. In the UK, Royal Mail is the dominant operator is the mail market delivering about 99% of letters and parcels (WIK Consultant 2018).

Driven by competition and customer demands, Royal Mail uses advanced technology for different purposes in order to improve operational efficiency while offering new products and services to customers (Royal Mail 2017). First, Royal mail has used computer technology to develop and update a database of addresses and customer identities given that this company delivered to about 29 million addresses in the UK (WIK Consultant 2018). This innovation has helped Royal Mail identify its customers and update their details for faster delivery of parcels and mails. Second, Royal Mail employs optical character recognition to sort letters and bulk mail automatically and delivering the sorted mails to customers’ local delivery offices (Royal Mail 2017). Additionally, Royal Mail uses barcoding technology to facilitate easy machine reading and allow all relevant information on mails and parcels to be scanned and interpreted easily and faster (Royal Mail 2017). Today, Royal Mail requires all parcels and large letters to include a two-dimensional barcode. The barcode technology has not only improved handling but also facilitates tracking of information to senders and receivers (WIK Consultant 2018). The company also offers a 2D barcode option for letters commonly known as Mailmark. The Mailmark barcode helps track mails in Royal Mail’s mail centres and delivery offices ensuring that mails are delivered to their owners in a timely manner (Royal Mail 2017). The 2D Mailmark also ensures that senders and producers of mailings receive updated information every day using web-based reporting dashboard. Furthermore, Royal Mail’s delivery staff have personal digital assistants (PDAs) aimed at improving efficiency in mail delivery. The PDAs have helped delivery staff collect recipients’ signature as digital images which is then used by senders to confirm delivery. Royal Mail also uses Zebra Technologies TC75 to improve tracking in that these technologies enable couriers to scan barcoded letters and parcels and enhance recipient interaction and the receipts are informed on the location of delivery. Royal Mail has also launched advanced recipient services for its Parcelforce Worldwide division offering express services. The Parcelforce select service allows recipients to change the delivery location of their parcels in case the recipients are in transit. The Parcelforce technology have more notification options including notifying the recipient an hour to the delivery time. Royal Mail has also embraced 3D printing services to enable its customers to print their mails while at home (Royal Mail 2017). Royal Mail realised the 3D printing innovation through partnership with iMakr. Royal Mail has also applied technology in its sustainable operations. According to WIK Consultant (2018), Royal Mail aims to reduce emissions resulting from its UKPIL operations by 20% by 2021 and in order to attain this, the company has upgraded its building and fleet. On the other hand, WIK Consultant (2018) state that Royal Mail has achieved Carbon Trust Standard by reducing carbon emissions. Royal Mail had also tested a hydrogen-powered delivery van and currently uses fuel-efficient diesel-powered vehicles such as double-deck trailers.

Through the above technologies and innovations, Royal Mail has been able to maintain an annual growth of around 4% ever year (Royal Mail 2017). After the introduction of the PDAs, the company realised a profit of 559£m before tax in 2018 compared to 538 £m of the previous year (Royal Mail 2017). The 2018/19 annual report also highlights that technology and innovation are key to driving efficiency in the organisation’s operations. Therefore, we can conclude that Royal Mail has remained the dominant player in the UK mail industry by embracing the role of technology and innovations and quickly changing their operations to reflect technological advancements.

Task 2

A: Importance of corporate social responsibility for Royal Mail PLC

Corporate governance is a set of processes and procedures directing and controlling the actions of a company in order to build an environment of transparency, trust, and accountability (Jizi et al, 2014). On the other hand, corporate social responsibility (CSR) refers to the commitment by an organisation to contribute to sustainable economic development while working with employees, their families and the community at large (Garas and ElMassah 2018).

The evolution and development of the UK corporate governance is dominantly characterised by shareholder value where corporate managers are assigned the role of an agent and the shareholder the role of a principal (Price et al. 2018). Traditionally, the central focus of the management is on fiduciary duty seeking to serve the interests of the company while considering the current and future needs of the shareholders (Pletz and Upson 2019). However, in the 21st century the corporate model gained acceptance where organisations largely relied on self-regulation and statutory guidance (Davis and Kim 2015). This shift was influenced by several factors including global commercial growth, OECD recommendations, EU harmonisation, and global and domestic corporate shocks. In the corporate business model, regulations and practices are designed primarily to lower the problems resulting from managers taking self-interest actions that have the potential to adversely affect the business (Nordberg and McNulty 2013). For example, empire building without considering the quality and cost of acquisitions in that executives know that remuneration is positively related to organisational size (Pletz and Upson 2019).

In the corporate governance era, business have multiple stakeholders and executives are accountable not only to shareholders but to the society-at-large (Gregg et al. 2012). This implies that today, business do not only exist to make profits but to add value to the lives of their customers, the society they operate in and conserve the environment in which they operate (Nordberg and McNulty 2013). In the UK, a principle-based jurisdiction is adopted where businesses are expected to comply with the regulations or explain why they are not complying (Jizi et al, 2014). For example, businesses are encouraged to comply with environmental laws and show actions they are taking to reduce carbon emissions (Jizi et al, 2014). In addition, organisations are expected to comply with tax regulations while practicing transparency in financial auditing (Garas and ElMassah 2018).

Since the publication of the Cadbury report, in 1992, the ties between shareholders and executives have weakened paving way for modern corporate governance (Garas and ElMassah 2018). The Cadbury report focused on the reporting function and the relationship between audit, board, and shareholders advocating for the precepts of accountability, openness, and integrity (Price et al. 2018). Today, businesses in the UK operate based on the precepts of accountability, openness, and integrity not only to shareholders but also to other stakeholders.

CSR is crucial to the success of Royal Mail PLC among other business in the UK. Social responsibility, sustainable development, and environmental impacts are commitments and values that characterise Royal Mail PLC. The company attempts low emission vehicles and production processes, improved environmental technologies, and sustainable production materials with close attention to society’s health (Royal Mail 2018), which has promoted brand loyalty among customers in the UK. In addition, Royal Mail maintains a database of clients’ information and customises its services to client expectations which results in higher level of satisfaction (Royal Mail 2017); this has influenced customer loyalty. Royal Mail has also committed to development of its employees which is evident in the half hour learning opportunity the company offers all its postmen and women within their scheduled duty time (Royal Mail 2017). Commitment to develop employees has benefited Royal Mail will skilled workers who are able to meet the current and the future needs of the organisation. In addition, developing the employees helps Royal Mail to attract and retain best talent, which ensures they organisation has the right resources for effective operation. The UK environmental policy encourages businesses to improve environmental performance and develop aims that care for the environment. In compliance, Royal Mail and Parcelforce have developed different and efficient modes of transport for the movement of letters and parcels. For example, for less than 100 miles, the company uses road to move items, up to 250 miles the company uses train, and more than 250 miles the company uses air for time critical mail (Royal Mail 2017). Through these initiatives, Royal Mail has played a significant role in improving efficiency while enhancing environmental impact. Through the use of vehicles powered by low-sulphur diesel, Royal Media has already attained approximately 12% reduction in carbon dioxide emissions (WIK Consultant 2018). Royal Mail also disposes older bicycles in an environmentally and socially responsible way: they are donated to Re-Cycle which is a charity organisation that sends bikes to developing countries providing a transport lifeline for isolated communities (Royal Mail 2017). Through these initiatives, Royal Mail is able to meet the expectations of customers and of the larger society, which builds brand image and reputation.

B: Explanations of Carroll’s Pyramid model

Carroll (1979) defines CSR as the social responsibility of business that incorporates the economic, legal, ethical, and discretionary expectations of the society. Later in 1991, Carroll proposed that CSR has four dimensions namely economic, legal, ethical, and philanthropic which he presented in the form of a pyramid commonly known as Carroll’s Pyramid model (See Figure 1).

Economic responsibilities relates to how an organisation allocates financial resources to realise profits that will facilitate the existence of the business. According to Carroll (2016), achieving profit is essential for the survival and development of a company. Royal Mail PLC finances its business operations by raising profit through mail delivery across UK and other countries in Western America and Canada.

Legal responsibilities relate to the actions that a company takes in order to comply with all local, national, and internal laws as well as respect for human rights (Carroll 1991). According to Carroll (2016), a legally responsible business offers products or services in a way that meets the least minimum legal requirements while abiding to corporate citizenship laws and fulfilling all legal obligations towards stakeholders. Royal Mail pays its taxes to the government and creates a good work environment for its workers (Royal Mail 2018). In addition, Royal Mail observes gender equality in offering employment opportunities: it has been recognised as a top 50 employer for women in 5 consecutive times (3BL Media 2018). Further, Royal Mail assess the needs of its customers and innovates to meet the ever-changing customer needs (Royal Mail 2017).

For most organisations, ethical responsibilities are defined in a framework of activities that the company conducts in order to accomplish its mission (Carroll 2016). This framework in most instances contain a list of key values and their definitions (Carroll 2016) which the company follows in decision making and problem solving. These are further expressed through formalisation of moral norms which appear in the form of sets of good practice and ethical codes. Royal Mail operates with a vision of being recognised as the best delivery company in the UK and across Europe and to attain this vision, the company is committed to responsibly managing its impact on the world and developing positive relationships with all stakeholders. The company also values integrity and fairness in how it relates with stakeholders.

The philanthropic responsibilities relates to the actions an organisation takes to support the needy persons and various ways of volunteering to develop the community (Royal Mail 2016). In most organisations, philanthropic activities are conducted through charitable organisations to achieve various social goals (Carroll 2016). In the 2018 financial year, Royal Mail contributed £7.1 million directly to charities, good causes, and schemes for disadvantaged groups.

Conclusion

The aim of the paper was to explore the role of technology and innovations in the organisational performance of Royal Mail PLC as well as the importance of CSR with special focus on Royal Mail. The paper establishes that through technology and innovation, Royal Mail is able to develop new products, improve existing products, and develop new delivery processes to better meet the needs of its customers. The paper established that technology and innovation are positively correlated to economic development. In addition, the paper reveals that CSR is integral to sustainable development. Using Carroll's Pyramid model, the paper establishes that Royal Mail is socially responsible, which promotes its ability to meet the future needs of its customers.

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