MGMT1101 Final Project: Magna International Analysis and Strategies

This report provides a comprehensive analysis of Magna International, a Canadian mobility technology organization. It begins with an introduction and a summary, followed by a detailed SWOT analysis that identifies the company's strengths, weaknesses, opportunities, and threats, and formulates strategies to leverage them. The report also explores environmental constraints, including political, economic, social, technological, legal, and environmental factors (PESTLE analysis), and their impact on the company. It examines stakeholders such as employees, customers, communities, and shareholders, and their influence on the organization. The report further discusses organizational structure and design, including divisional, automotive, and executive management methods, and explores Hertzberg's two-factor theory of motivation. Finally, the report offers recommendations for business progress and concludes with a bibliography of cited sources.

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Summary
Magna International is known as the Canadian mobility technology organization for automakers.
In 2019, it has become one of the biggest organizations in Canada. It is also recognized as the
largest manufacturer of automobile parts within North America through the sales of unique
equipment parts. The company supplies its parts to General Motors, BMW, Tesla Motors,
Mercedes, Volkswagen, Ford motor company, and many others. This report will explain that
organization by applying the strategies on SWOT analysis will become more capable to take
advantage of strengths and opportunities and minimize the threats and weaknesses. Further
discussion will explain environment constraints that will include the organization's PESTLE
environment. It will help the business to make the changes according to the business
environment. This report will discuss the organizational structure and design. It describes the
methods of business to manage organizational design and structure. The report covers
Hertzberg's two-factor theory which is effective to motivate employees and gain the desire
objectives in a competitive environment. In the end, the report will provide the recommendations
which are necessary for the progress of the business.

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Table of Contents
Summary.....................................................................................................................................................1
Introduction.................................................................................................................................................3
SWOT analysis – Formulating strategies.....................................................................................................3
Strengths..................................................................................................................................................3
Weaknesses.............................................................................................................................................3
Opportunities...........................................................................................................................................3
Threats.....................................................................................................................................................4
Environmental constraints...........................................................................................................................4
Political factors........................................................................................................................................4
Economic factors.....................................................................................................................................4
Social factors...........................................................................................................................................5
Technological factors..............................................................................................................................5
Legal factors............................................................................................................................................5
Environment............................................................................................................................................5
Stakeholders................................................................................................................................................6
Employees...............................................................................................................................................6
Customers................................................................................................................................................6
Communities...........................................................................................................................................6
Shareholders............................................................................................................................................6
Organizational structure and design............................................................................................................7
Motivational theory.....................................................................................................................................8
Control & recommendations........................................................................................................................8
Conclusion...................................................................................................................................................9
Bibliography..............................................................................................................................................10

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Introduction
This report will provide information about Magna International. This will include the
SWOT analysis which works for the business to identify and implement the strategies to gain a
competitive advantage and increase the base of customers within the organization. Environment
constraints describe the factors which affect the business and run the business activities to ensure
long-time stability. The discussion will cover the analysis of stakeholders such as employees,
customers, communities, and shareholders. This discussed that shareholders are important for the
business as it helps to plan the financial conditions and business operations. Further discussion
will cover the organizational structure and motivational theory for the engagement of employees.
SWOT analysis – Formulating strategies
SWOT analysis is effective to analyze the competitive advantage of sources (Mathur, &
Agarwal, 2016).
Strengths
Benefits of strengths such as product portfolio will be taken by the organization through
improving the communication, collaboration, prioritize the focus of products, and improve the
investments of products by ensuring the alignment of product investment with objectives of a
business. Authentic suppliers will help to build a good relationship with suppliers and minimize
the issues regarding availability and delays of products.
Weaknesses
The high attrition rate within Magna International will be minimized by offering the
employees regular training through programs that increase the skills and help them to gain a
good position with an increased salary. The organization should plan the financial budget as per
the last year's performance and competition it will help the business to manage the financial
inefficiencies.
Opportunities
This is very important to take advantage of opportunities to gain success (Nikjoo, &
Saeedpoor, 2014). The organization should connect the different zones with the expansion of
business activities to deliver services as overall increase the organization profits. The use of new

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techniques and e-commerce will help the business to increase the good experience for the
customers and build a good relationship with the fast delivery of services.
Threats
There is high competition for Magna International. It should focus to know the
customers’ requirements, and target the new markets to improve the base of customers.
Customer's behavior regularly changes so it will be important for the business to implement the
changes as per the market.
This will be important for the business to focus on the investors and build the strategies to
minimize the weaknesses and threats (Scolozzi, et al., 2014). It should work to use strengths and
opportunities to gain success and competitive advantage. Effective application of strategies will
work for the business to stand within the competitive environment.
Environmental constraints
Changes within the macro-environment factors have a direct impact on Magna
international and other organizations in auto parts wholesale. These factors have an impact on
the organization's profitability levels of the service industry.
Political factors
These factors play the very important to determine factors that can impact the
organization's term profitability within a particular nation or market (Abubakar, Abubakar, &
Abdulrahman, 2018). This organization is operating within the many nations and also faces
political system risks and different types of political environment. The organization to gain
success within the dynamic auto parts wholesale industry across many nations is required to
diversify systematic risks regarding the political environment. This is important for the business
to provide mandatory benefits to employees due to many regulations regarding trade and tariff
services.
Economic factors
Additional supply within the industry is followed through a price that is lower compare to
the price of Magna international and led to cash flow issues for suppliers. The economic
downturn is the main issue within the industry as it can slow the production.

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Social factors
Social factors contribute to organizational growth (Arinze, Igwe, & Una, 2015). The
government of many nations concentrates on human funding development within the auto parts
sector through training due to an increase in the knowledge of sources within the market.
Technological factors
There are many technical issues faced by the organization particularly manufacturers not
have own innovation and still depend on the many abroad technological companions.
Legal factors
The legal process of the organization has many issues and changes within the form of IP
legal rights and lawful agreements. This organization has the legal protection to shield
intellectual property processing and modern techniques that can improve the dependency of
others on Magna International Inc.
Environment
This organization is committed within the health, safety, and environmental practices
within the operation by technical innovation and processes efficiency to reduce the impact of
operations on the environment and deliver safe conditions of working.
Magna International continuously attempts to estimate the environmental clean-up
liabilities like exercise is critical. Environmental rules and regulations are critical, change very
fast and have tended to become more expensive over time and have an impact on profitability.
This organization has named as the potentially responsible party of the contaminated site.
Associated cost with the potentially responsible party can be material depends on the conditions
of the site and participating number of the potentially responsible party. This can incur the cost
or liability within the excess of the amount that reserved and have an adverse impact on
profitability, operations, reputation, and financial situations.
Leadership development and program regarding succession will bring opportunities for
businesses to match the pace of worldwide growth. This will help them to maintain the proper
planning with the important skills and expertise to manage the critical business issues.

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Stakeholders
Stakeholders have an interest within the organization and care about the well-being of an
organization (García-Madariaga, & Rodríguez-Rivera, 2017). Stakeholders of the Magna
International are employees, shareholders, communities, and customers.
Employees
Employees are important stakeholders for Magna International. These are important for a
business to increase the level of customers’ satisfaction. These all manage the activities within
the business to gain competitive advantage and increase profits.
Customers
Effective customer’s choices force a business to produce high-quality automobile parts
with quality services at a reasonable price. The organization addresses the customer’s interest by
innovation based on the production system by improving the quality and efficiency of products.
Communities
Communities have importance at a high level within the business by running many
programs. This organization runs many programs to increase the ratio of literacy. This also
works with many businesses to support and develop the community.
Shareholders
These are known as the main stakeholder groups (Stephen, Kumar, & Nadu, 2015). This
organization addresses the shareholder's interest by a prominence on worldwide business
strengths. These help businesses to focus on rapid expansion and earn more profits.
These provide additional capital for investments (Teo, Nishant, & Koh, 2016). Shareholders
are known as important stakeholders as play important roles within the organization's operations.
Shareholder manages financing, governance, operations and control aspects of Magna
International through their opinions and functions. Shareholders elect the directors that choose
and appoint senior officers including the CEO and play a vital role within the projection and
implementation of strategies.

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Organizational structure and design
(Pfeiffer, 2019)
There are divisional, automotive, and executive management methods. Management
within the manufacturing divisions has discretion for determining the payment rates, working
hours, supply and contract sources for performance. Management of the automotive group is
responsible to coordinate for the development of products, marketing, and finance by
maximizing the efficiency of manufacturing within the divisions of manufacturing by including
the group. Every automotive system group lines with consumers and provide the information and
advice to respective divisions. Executive management of organization coordinates in advance
with the system development, manufacturing by ensuring the satisfaction level for the customers
and interfaces with a community of investors. These are responsible regarding the long time
strategic planning and growth of the organization by monitoring the automotive group
management performance (Magna International INC, 2017).
Organizations to increase the efficiency of the organizational structure should offer
specialization at a high level. It will improve productivity with the specialized skills and
techniques as employees become experts. Improvement within the employee's working skills can
be initiated by the functional specialization and reduce the operations costs. This also leads to
solving the high-quality technical issues.

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Motivational theory
The motivational theory will be effective for Magna International to manage the business
and increase the satisfaction level of employees. Hertzberg's two-factor theory of motivation will
be effective for the business. In the 1950s it was developed by Frederick Herzberg (Patrick, &
Williams, 2012). It will include two factors such as motivators and hygiene factors. Motivator
factors lead to an increase in the level of satisfaction and motivate the employees to work harder
within Magna International. For example, it should develop a meaningful and respectful
relationship strategy. This approach will help to focus on improving the enjoyment within the
workplace, career progression, and feeling of recognized by timely reward and recognition
programs. Hygiene factors lead to dissatisfaction and a lack of motivation if employees are
absent. For example, it will help the business to implement the strategy of inspirational by
improving the benefits, salary, relationship with the management and employees.
Control & recommendations
Monitoring business activities, reviewing, and analyzing business performance is
effective to identify issues and success. Technical business process monitoring will be used for
monitoring the business actions and plans.
Feedback controls will be used to meet the objectives within the production plan by
comparing performance and take the solid steps to track the progress and make the appropriate
improvement. The employee's training program will be designed to improve the technical
knowledge, skills within regular intervals. The involvement of employees within the activities
will support the business to achieve the desired objective through applying own ideas, efforts,
and expertise to make the appropriate decisions and solve the issues.
The monitoring will be done based on the achievement of daily activities through
achievable targets and mitigates the distractions. The objectives are achieved by appreciating and
supporting the employees. Employees will feel treated and offer the best possible conditions of
working and support their relations. The application of useful methods has provided meaningful
learning to manage the business actions within the discipline methods to achieve the daily
objectives.

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Conclusion
In the limelight of the discussion, it can be concluded that Magna International has a
global presence at a high level within the customers. Further, it will need to implement the
strategies regularly to achieve the business objectives and gain a competitive advantage by
regularly monitoring and analyzing.

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Bibliography
Abubakar, S. G., Abubakar, M. Z., & Abdulrahman, A. (2018). Critical Evaluation of the
International Business Environment of a BRICS Member: A Case Study of the Russian
Automotive Industry concerning Competitiveness in the Domestic and International
Market Arena and the Contemporary Environmental Issue of Human Resources
Management. International Journal of Economics and Business Management, 4(1), 22-
40.
Arinze, I. E., Igwe, O., & Una, C. O. (2015). Analysis of heavy metals’ contamination in soils
and water at automobile junk markets in Obosi and Nnewi, Anambra State, Southeastern
Nigeria. Arabian Journal of Geosciences, 8(12), 10961-10976.
García-Madariaga, J., & Rodríguez-Rivera, F. (2017). Corporate social responsibility, customer
satisfaction, corporate reputation, and firms’ market value: Evidence from the automobile
industry. Spanish Journal of Marketing-ESIC, 21, 39-53.
Magna International INC, 2017. Magna Announces New Management Structure and Financial
Reporting Segments. [Online]
Available at: https://www.prnewswire.com/news-releases/magna-announces-new-
management-structure-and-financial-reporting-segments-665179113.html
[Accessed 06 04 2020].
Mathur, S., & Agarwal, K. (2016). Financial analysis of automobile industries (A comparative
study of Tata Motors and Maruti Suzuki). International Journal of Applied
Research, 2(9), 533-539.
Nikjoo, A. V., & Saeedpoor, M. (2014). An intuitionistic fuzzy DEMATEL methodology for
prioritizing the components of the SWOT matrix in the Iranian insurance
industry. International Journal of Operational Research, 20(4), 439-452.
Patrick, H., & Williams, G. C. (2012). Self-determination theory: its application to health
behavior and complementarity with motivational interviewing. International Journal of
behavioral nutrition and physical activity, 9(1), 18.

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Pfeiffer, P. (2019, 11 19). Organizational structure. Retrieved from edrawsoft:
https://www.edrawsoft.com/orgchart/organizational-chart-for-automotive-industry.html
Scolozzi, R., Schirpke, U., Morri, E., D'Amato, D., & Santolini, R. (2014). Ecosystem services-
based SWOT analysis of protected areas for conservation strategies. Journal of
environmental management, 146, 543-551.
Stephen, G., Kumar, E. R., & Nadu, T. (2015). The Implementation of Green Supply Chain
Management Practices in the Automobile Industry. International Journal of Innovative
Research in Science, Engineering and Technology, 4(4), 233-237.
Teo, T. S., Nishant, R., & Koh, P. B. (2016). Do shareholders favor business analytics
announcements? The Journal of Strategic Information Systems, 25(4), 259-276.