Management Strategies – Notting Hill Genesis

1.0 Introduction

Notting Hill Genesis is a housing association established in 2018 following the merger between Notting Hill Housing and Genesis Housing Association. The organization has since grown to become one of the best in London and the southeast. Notting Hill Genesis owns and manages over 65,000 homes in these areas and has approximately 2,000 staff on its payroll (Notting Hill Genesis 2022). The organization is committed to the continuous delivery of affordable housing to all. The establishment of the two legacy organizations that led to the birth of Notting Hill Genesis can be traced back to the 1960s when the local people with a common vision of housing the working population in London by offering them a home from which they could develop themselves a better future came together (Notting Hill Genesis 2022). This essay analyses various aspects of Notting Hill Genesis business environment.

2.0 Business Environment Analysis

A business environment analysis refers to a strategic tool used by businesses and organizations across the globe to examine all the internal and external environmental factors that affect their day to day operations. The analysis entails an evaluation of the opportunity or threat level that each environmental factor presents to the business. Companies use their environment analysis results to assist them in aligning their strategies to the environment. Notting Hill Genesis operates in a dynamic environment, which directly influences its operations as well as the ability to satisfy its goals and objectives. To compete successfully, the top leadership of Notting Hill Genesis must continually study the environment in which it operates and develop strategies accordingly. In this paper, the company’s internal business environment factors and their impacts will be analyzed using the SWOT analysis tool, while the PESTLE analysis tool used to evaluate the external business environment factors.

2.1 Internal Business Environment Factors

The internal business environment analysis involves the evaluation of the internal environment of a company to determine its capabilities, competencies, characteristics, assets, and resources. It helps identify the organization’s strengths and weaknesses that the top leadership can use during strategy formulation and decision-making processes. Many internal business environment factors influence operations at Notting Hill Genesis. Such factors are as discussed in the SWOT analysis below;

2.1.1 SWOT Analysis

A SWOT analysis will help in revealing Notting Hill Genesis’ internal strengths and weaknesses. Further, the tool will also be instrumental in discovering the external opportunities and threats that affect the business.

Strengths

Leadership: Notting Hill Genesis boasts of a strong leadership team that has been able to provide a strategic direction and handle the daily operations of the business effectively (Notting Hill Genesis 2022). The organization’s top leadership has made sure that Notting Hill Genesis operates in an ethical manner and satisfies the needs of its customers.

Staff: The Company has a dedicated, adaptable, and flexible team of employees. The organization’s staffs have a strong working relationship with the top management and show a high degree of engagement (Notting Hill Genesis 2022). Notting Hill Genesis also delights in its employees and offers them competitive salaries, as well as learning and development opportunities. Such acts have enabled the company to attract the best talents in the market, enhance staff morale, and increase profitability (Notting Hill Genesis 2022).

Reputation: Notting Hill Genesis has, over the years, managed to build a strong identity with a great reputation across London (Notting Hill Genesis 2022). The company has become one of the reputable housing associations in London, well-known for its commitment to building and maintaining quality affordable homes that help to promote the residents’ economic and social wellbeing (Notting Hill Genesis 2022). Such a great reputation has significantly helped the company attract more customers in the midst of stiff market competition.

Performance: The Company’s performance has been exceptionally good. It does its best to ensure that its customers receive high-quality service. According to a survey carried out by the firm, 73.7 percent of the residents were happy with the services they got from Notting Hill Genesis (Notting Hill Genesis 2022). Such a high rating in performance has helped the company attract more customers and remain competitive in its industry.

Adaptable to change: Notting Hill Genesis has improved processes through an IT system that has significantly helped to make work easier and help cut costs for the organization (Notting Hill Genesis 2022). Further, the company has also successfully completed the integration process that led to the birth of Notting Hill Genesis. It managed to achieve this by following an integration and change management policy in addition to offering the required training to the staff following the merger process (Notting Hill Genesis 2022). After the merger, successful adaption to change has helped the company retain its staff and maintain its market presence.

Weaknesses

Various factors characterize the company’s internal environment considered the business’ weaknesses. As the organization expands its operations, workload increases, thus putting pressure on the existing employees, which may adversely affect performance. Opportunities are also increasing across the sector, thus making it difficult for the company to retain staff, who are always on the lookout for better pay and benefits. Delays with new-build programs also affect the company as it loses out on potential customers (Notting Hill Genesis 2022). The company may also need to expand its existing office space as it continues to expand. This will mean additional costs to the organization.

Opportunities

A number of opportunities exist in the external market that Notting Hill Genesis can take advantage of to ensure its continued growth and success. For instance, the company can partner and work collaboratively with other regional housing associations to benefit from cost efficiencies. Cost efficiencies can be obtained through joint training, marketing, procurement, as well as resource sharing where possible (Notting Hill Genesis 2022). Apart from partnerships, the company can also consider appointing new staff in the market. The appointment of new staff can help Notting Hill Genesis benefit from new skills, refreshed thinking, and change. Demographic changes witnessed in the UK also present the opportunity to provide more stock and cater for the elderly population. The availability of land for potential development also presents an opportunity for the company to expand.

Threats

Threats that adversely affect the company’s operations come from all directions. One of such threats is competition. Notting Hill Genesis competes for funding and is actively looking to overtake other housing associations in the industry. Similarly, the market also has private house-builders looking for the land, thus minimizing the amount of land available for social housing. Apart from competitors, there also exists the threat of social changes in society. For instance, the aging population is increasing, and household sizes are also reducing. Such developments have adverse impacts on the demand for the company’s services. Another threat regards difficulty paying rent, especially for single pensioners and single people. Their inability to afford rent may result in some houses remaining unoccupied. The last threat is COVID-19. The impact of the pandemic on Notting Hill Genesis’ operational activities and its customers can be seen in the company’s increased bad debts and arrears in the 2020/2021 financial year (Notting Hill Genesis 2022). Rental streams from the company’s commercial business areas have also been adversely affected by the pandemic.

2.2 External Business Environment Factors

An external environment analysis must accompany every internal business environmental analysis to facilitate the development of reliable strategies by an organization. The external business environment normally consists of environmental factors that change constantly and are beyond the organization’s leadership control. Like any other organization, Notting Hill Genesis’ operation is affected by different technological, economic, social, legal, environmental, and political forces that result in unique business opportunities and challenges. The PESTEL framework provides a great tool for analyzing factors operating in Notting Hill Genesis’ external business environment.

2.2.1 PESTEL Analysis

Political Factors

Brexit

The United Kingdom has officially exited the European Union, a move that presents significant challenges to the organization. It is inevitable that the trade agreements made post-Brexit will result in price increases for goods, and this will affect the company’s costs of offering its services to the tenants and reduce its chances of developing new homes or refurbishing the existing older stock (Smith, Ahmed, and Saboor 2020). Given the United Kingdom’s government change in attitude to individuals from the EU nations, Notting Hill Genesis has witnessed some of its tenants from such countries relocating to their homes. The company expects that this trend will continue for the next few years, and it may adversely affect the organization’s capability to fill local jobs.

Housing Policy

The Grenfell Tower tragedy resulted in the enactment of regulatory and housing policy changes that are continuing to have significant effects on social housing (Hodkinson 2020). The regulatory and policy changes have led to a considerable increase in costs for Notting Hill Genesis as it works to ensure that all its new and existing homes satisfy the set standards. In addition, the regulations stress the need for more quality social housing for low-income individuals and encourage residents to voice their opinions more forcefully (Hodkinson 2020).

Welfare Reform

The government of the United Kingdom is continuing to roll out various welfare reform measures to date. At the heart of the policy is the expectation of work in consideration of benefits. Financial inclusion activity and helping residents become work-ready has positively helped enhance the Notting Hill Genesis income streams. However, the uncertainty surrounding the supported housing funding has adversely affected new schemes delivery by the company (Preece, Hickman, and Pattison 2020).

Economic Factors

Poor housing affordability

While rents and prices of houses in London are not estimated to continue increasing like a couple of years ago, inflation in the cost of housing is projected to be considerably higher than the growth of income in the coming years (Haffner and Hulse 2021). People’s ability to afford houses will continue to be low because of various economic reasons associated with Brexit and the Covid-19 pandemic. Despite the unfavorable sales market and increased construction costs due to price increases, housing associations, including Notting Hill Genesis, are still expected to deliver. Government activities such as providing funding for new housing only work to destroy the market for housing associations. Poor housing affordability has forced the company to explore innovative ways that it can use to enhance its financial capacity for increased development. In all its undertakings, Notting Hill Genesis gas to make sure that the rents it charges remain affordable to individuals on lower-income.

Economic conditions

The decision to leave the European Union by the United Kingdom is a political and economic climate uncertainty that is expected to continue for a while. Lack of confidence in the UK’s economy has resulted in low levels of investment by the housing associations (Smith, Ahmed, and Saboor 2020). The prices of imports have also been affected because of the reduced sterling strength. In addition, higher inflation and interest rates have also been reported in recent years, thus adversely affecting the company’s development and expansion activities.

Housing association capacity

The capacities of housing associations, including Notting Hill Genesis, have been impacted by the consequences of the Grenfell Tower tragedy, including increased maintenance and development costs (Tombs 2020). Investors are also becoming more aware and knowledgeable of the social housing sector, increasing competition. The competition has been enhanced by banks that are now entering London’s lending market. To maintain or increase their capacity, housing associations have been forced to strengthen their income and further improve their efficiency.

Housing market

Limited affordability and the continued uncertainty surrounding Brexit have adversely affected sales transactions and house prices. House buying by younger households has been adversely affected by increasing interest rates that have affected mortgage availability. Costs of development for houses have increased due to increased product prices that resulted from the Covid-19 pandemic’s disruptions in the supply chain (Blakeley 2021).

Living standards

Housing associations are suffering from the increasing inflation rate, which has reduced residents’ disposable income making it difficult to pay for their houses. Job security for lower-income individuals remains poor hence presenting significant impacts to housing associations. Incomes may continue to fall or remain constant to match the slow growth in market rents and house prices.

Social Factors

Demographic change

The population of the elderly in the United Kingdom is increasing, thus resulting in increasing social and support needs. The nation has also been experiencing a growth in the number of adults below the age of 30 years who are living in or going back to the family home. This has significantly impacted the demand for new housing. Further, changes in immigration patterns, primarily because of Brexit, have led to the construction skills shortage, adversely affecting housing associations’ development activities. As a result, investment by the government in housing has been so low that it fails to match the increasing pressure on housing resulting from the growth in population (O’Leary and Simcock, 2020).

Alienation

Poor housing market affordability has adversely affected many people’s dreams of starting a family and having a home. The cohesion of the community has also been adversely affected in London by the increasing inequalities between the poorer and richer community sections. The Grenfell Tower tragedy also negatively affected people’s attitudes towards social housing, local authorities, as well as the government. Social media effect, weaker government, and policy and economic concerns will generally result in a volatile public mood, thus making it difficult for housing associations to operate (Preece et al. 2020).

Austerity’s impact

The volatility of the labor market is adversely affecting employment opportunities and incomes. Households are experiencing increasing debt levels, thus limiting their ability to take in new financial and economic shocks. Service expectations and housing associations demands are projected to increase with alternative help sources decreasing. Reductions in the provision of social care present significant consequences on the well-being of older people (O’Leary and Simcock 2020). Apart from increasing early years childcare provision, the government is also encouraging lone parents to search for job opportunities.

NIMBYism

The housing crisis has become an important issue of concern among many London dwellers. This implies that many people in the region recognize the need to develop more houses in their areas. However, well-housed individuals may have issues with the development of affordable housing near or within their area of residence. This may force the government to provide more incentives to such communities to accept such development. In addition, the need to protect the Green Belt and green fields is adversely affecting many housing associations’ housing planning and delivery.

Technological factors

Technology environment

Computer usage is continuing to increase, thus rendering many people and organizational activities obsolete. Nonetheless, computer power has been instrumental in the provision of improved operational and automated systems. Housing associations have been forced to invest heavily in computers to enhance their operations and remain competitive in the market. Building technologies innovations have ensured efficiency and enhanced construction and maintenance practices. The increasing use of computers in which computer insights like Big Data augmenting the employee’s thinking provides housing associations with the chance to change working practices and services (Ellison-Barnes et al., 2021). Hacking practices are becoming rampant and more complex, forcing businesses to update their systems more frequently.

Data quality and protection

The control and update of data in large companies like Notting Hill Genesis are normally difficult because of the complexity involved in the provision of service. Organizations may end up facing legal and regulatory consequences when they fail to manage their data appropriately. The General Data Protection Regulations have resulted in increased regulation and safeguards on activities regarding customer profiling. Given the increasing cyber-attack activities through ransomware, great awareness from the organizational staff is required.

Service access

There exists an increasing need among social housing residents to access the internet. These individuals normally require landlords to provide internet services to enable them to access their welfare benefits. However, some social housing tenants will resist the idea of going online or will require to be helped to attain digital skills. Some customers will expect online self-services like banks and other utility organizations. Social media offers a platform for service providers and customers to communicate effectively in the modern business world. Companies will have to provide resources and come up with a careful strategy of incorporating social media use while avoiding the potential legal pitfalls.

The workplace

Technological advancements have increased the ability of organizational members to work remotely hence providing housing associations with the chance to make changes to their working practices and office strategy. Remote working can be instrumental in ensuring value for money and enhancing energy efficiency. Nonetheless, facilitating remote working requires significant upfront investment by the company. The growth and increased use of such technologies as artificial intelligence, 3D printing, and cloud mean additional investment costs to the organization.

Environmental Factors

Sustainability

Anxiety regarding the economy as well as the general political upheaval may make it difficult for green issues to attract attention. Nonetheless, the general population has become more concerned and interested in environmentally friendly behaviors. Greenfield sites are to be preserved and not used for any development activity.

Fuel poverty

The increasing inflation rate will increase household energy costs, adversely affecting household budgets. In addition, rent cuts are most likely to reduce the housing association’s capacity to carry out planned maintenance programs. Similarly, increased costs of maintenances reduce the finances available for funding fuel poverty initiatives (O’Leary and Simcock 2020).

Legal Factors

Financial regulation

The tough lending environment resulting from the increased liquidity requirements for financial institutions by the Bank of England has adversely affected housing associations’ development activities. Shared ownership regulation has also limited the number of financial lenders operating in the market. Mortgage supply has also been changed following the Mortgage Market Review of 2012 that limited the availability of credit.

Legal

The government may review the leasehold sector practices, resulting in changes in ground rents policy and leasehold tenure. Similarly, continued struggle with austerity and welfare cuts by the residents may result in increased costs, evictions, as well as legal action (Clegg and Farstad 2021).

3.0 Current Strategic Position

Established in 2018, Notting Hill Genesis is growing to become one of the industry’s major players. Today, the company employs more than 2,000 staff and owns and manages over 60,000 homes, making it count among the most significant housing associations in London (Notting Hill Genesis 2022). The company offers homes across various tenures and focuses on delivering affordable housing to everyone. Almost 50 percent of the homes owned or managed by the company are general needs properties in which it charges affordable rent levels (Notting Hill Genesis 2022). In addition, Notting Hill Genesis also provides commercial properties, shared ownership, temporary housing, and older people-supported accommodation.

Despite the risks of unsold homes, low occupancy levels, and rent arrears caused by the Covid-19 over the last two years, the company remains financially strong given the liquidity of £923.3 million by March 2021 (Notting Hill Genesis 2022). In the 2020/21 financial year, Notting Hill Genesis developed 794 homes, transferred 34 homes between sales types, and got 271 homes transferred to different rental tenure types (Notting Hill Genesis 2022). The company also managed to sell 477 homes to individual buyers and dispose of 109 homes through the bulk sale (Notting Hill Genesis 2022).

Notting Hill Genesis operates in a very competitive market. Some of the industry players that pose a threat to the organization’s success include Clarion Housing, Peabody Trust, The Hyde Group, Network Homes, and One Housing Group. The United Kingdom has more than 1,600 housing associations, including charities, non-profit, and for-profit companies (Shabrina, Arcaute, and Batty 2022). In addition, more than 190 registered local authorities provide social housing services in the United Kingdom. Surviving in a market featuring many industry players requires companies like Notting Hill Genesis to develop strategies that will help them remain competitive and attract more customers for maximum profitability. The increasing number and expansion of the current industry players may adversely affect the success of the company if appropriate strategic options are not taken.

4.0 Strategic Options

One of the strategic options that Notting Hill Genesis can take to ensure its survival in the highly competitive housing market is to focus on providing a modern, digitally-enabled housing service that promotes the happiness and safety of its residents. This strategy aims to improve the residents’ experiences by enhancing the organization’s online services and automation without compromising the safety and quality of the company’s existing homes. The company needs to ensure that digital technology is central to its business. Notting Hill Genesis must also see that it solves complaints quickly, gets back to the customers as fast as possible, and honors its promises to the residents by completing repairs on time to ensure an enhanced customer experience. Furthermore, the residents’ happiness and safety can also be enhanced by investing in digital technologies that promote self-service for the residents. Offering unique services that enable the company to have a close relationship with the residents, understand the residents’ needs, and act on them accordingly will help the company attain the highest residence satisfaction levels in the industry at reduced costs.

The second strategic option for the company is constructing and offering new homes. The increasing population implies that the demand for housing will increase in London. Thus, the company can take advantage of the impending housing crisis and focus on developing more low-rent secure homes and making them available to those who are in need of them. Despite its challenges, more new affordable houses are needed in London today. Therefore, the company should rise to the challenge and partner with private developers, local authorities, and the government to acquire land and develop more homes. Doing so will help to increase the company’s presence in the market and reach out to more customers.

While the two options are viable, I consider the first one as the best option that Notting Hill Genesis should adopt. Effective customer service aimed at incorporating technology to enhance the residents’ experience will be instrumental in helping the company beat the competition. Unlike the second option, this option is more of an immediate solution to the competition experienced in the industry. With regards to cost, this option does not require huge amounts of funding equal to the ones needed for acquiring land and putting up new homes. Furthermore, customers satisfied with the services offered by the company will help to market Notting Hill Genesis by reaching out to more potential customers, advising them to do business with the firm because of its exceptional customer service. Digitally enabled housing service will also help the company retain its residents because of their satisfaction.

Furthermore, the second option, which entails developing more new homes, presents a lot of challenges to the organization. First, the company will need to be innovative in its arrangements to deliver more new homes. Notting Hill Genesis will have to look into various methods to help it achieve this goal, including having joint ventures and entering into strategic deals with other housing associations, local authorities, private developers, and investors. Secondly, the Grenfell Tower tragedy and Brexit have adversely affected development costs by increasing product prices (Hodkinson 2020). Similarly, Notting Hill Genesis will also need to acquire the appropriate technical expertise required for the construction projects, which translates to additional costs to the firm. Finally, undertaking the second option implies a greater financial risk, which may not be easy to maneuver given the covid-19 and Brexit associated impacts.

5.0 Key Principles of Successful Change Programs

To keep pace with competition and the constantly changing business environment, companies normally end up adopting enterprise changes that affect their processes and staff in one way or another. Change is part of the life of most organizations across the globe today (Jayatilleke and Lai 2018). However, the implementation of change in a company is never an easy thing as most people often tend to resist it. Successful implementation of change requires businesses and organizational leaders to assess people’s readiness for change, improve the staff’s understanding of the change, enhance communication, and identify and mitigate risk factors (Dzwigol et al., 2019). Change management seeks to ensure the successful implementation of new processes or business strategies while reducing adverse outcomes.

Successful implementation of change will significantly depend on the organization’s leadership. Strong leadership is instrumental in motivating and encouraging the organizational staff to change in order for the firm to adapt and compete in a highly competitive environment. Organizational leaders also build a culture within the firm that promotes change. Changing customer requirements, disruptive changes in the market, and collaborative arrangements may result in culture change, which may affect successful change implementation. Leaders must develop appropriate strategies to counter such issues.

The preferred strategy option for Notting Hill Genesis is to focus on providing a modern, digitally-enabled housing service that promotes the happiness and safety of its residents. This strategy aims to improve the residents’ experiences by enhancing the organization’s online services and automation without compromising the safety and quality of the company’s existing homes. This will require the company’s staff to adapt to the new ways of operation to be introduced. As the company changes the way it works, the organization will need to provide high-quality training to the staff on the usage of the new technology (Dzwigol et al., 2019). During training, the employees will be made to understand the reasons for change, its impact, and how it will affect different employees. They will also be equipped with the necessary skills to help them work effectively with the new technology.

Better engagement and communication with the organizational staff by the company’s leadership will be instrumental in avoiding resistance and ensuring the success of the new strategy to be adopted. For continuous improvement purposes, the company will have to extend its benchmarking to feature other best-performing organizations in the industry like Clarion Housing. The annual cost per unit comparisons of the Social Housing Regulator as well as the new Sector Scorecard can be used by the company to measure its costs and performance. An important task for Notting Hill Genesis in adopting this strategic option will be to enhance the organization’s housing management value for money and ensure that it offers quality service to the residents at the lowest possible costs.

References

Blakeley, G., 2021. Financialization, real estate, and COVID-19 in the UK. Community Development Journal, 56(1), pp.79-99.

Clegg, L. and Farstad, F., 2021. The local political economy of the regulatory state: Governing affordable housing in England. Regulation & Governance, 15(1), pp.168-184.

Dzwigol, H., Shcherbak, S., Semikina, M., Vinichenko, O. and Vasiuta, V., 2019. Formation of strategic change management system at an enterprise. Academy of Strategic Management Journal, 18, pp.1-8.

Ellison-Barnes, A., Moran, A., Linton, S., Chaubal, M., Missler, M. and Evan Pollack, C., 2021. Limited technology access among residents of affordable senior housing during the COVID-19 pandemic. Journal of Applied Gerontology, 40(9), pp.958-962.

Haffner, M.E. and Hulse, K., 2021. A fresh look at contemporary perspectives on urban housing affordability. International Journal of Urban Sciences, 25(sup1), pp.59-79.

Hodkinson, S., 2020. Safe as houses: Private greed, political negligence and housing policy after Grenfell. Manchester University Press.

Jayatilleke, S. and Lai, R., 2018. A systematic review of requirements change management. Information and Software Technology, 93, pp.163-185.

Notting Hill Genesis, 2022. About Us. Retrieved from https://www.nhg.org.uk/about-us/

Notting Hill Genesis, 2022. Annual report and financial statements. Retrieved from https://www.nhg.org.uk/media/20998/2021-nhg-annual-report-and-financial-statements-final.pdf

Notting Hill Genesis, 2022. Corporate Strategy 2020-2025. Retrieved from https://www.nhg.org.uk/media/19301/nhg-corporate-strategy-2020-2025.pdf

O’Leary, C. and Simcock, T., 2020. Policy failure or f*** up: homelessness and welfare reform in England. Housing Studies, pp.1-17.

Preece, J., Crawford, J., McKee, K., Flint, J. and Robinson, D., 2020. Understanding changing housing aspirations: A review of the evidence. Housing Studies, 35(1), pp.87-106.

Preece, J., Hickman, P. and Pattison, B., 2020. The affordability of “affordable” housing in England: conditionality and exclusion in a context of welfare reform. Housing Studies, 35(7), pp.1214-1238.

Shabrina, Z., Arcaute, E. and Batty, M., 2022. Airbnb and its potential impact on the London housing market. Urban Studies, 59(1), pp.197-221.

Smith, D., Ahmed, V. and Saboor, S., 2020. BREXIT: Assessing the Impact on the UK Construction Industry & Mitigating Identified Risks. In Proceedings of the International Conference on Industrial Engineering & Operations Management (pp. 515-523).

Tombs, S., 2020. Home as a site of state‐corporate violence: Grenfell Tower, aetiologies and aftermaths. The Howard Journal of Crime and Justice, 59(2), pp.120-142.

APPENDIX

1. Internal Business Environment Analysis

SWOT Analysis
Strengths	Leadership   Staff Reputation Performance Adaptable to change
Weaknesses	Increased workload   Staff turnover Delays with new-build programs Limited office space
Opportunities	Partnerships   Hiring new staff Demographic changes Availability of land
Threats	Competition   Social changes Difficulty in paying rent Covid-19

2. External Business Environment Analysis

PESTEL Analysis

Political factors	Brexit   Housing policy Welfare reform
Economic factors	Poor housing affordability   Economic conditions Housing association capacity Housing market Living standards
Social factors	Demographic change   Alienation Austerity’s impact NIMBYism
Technological factors	Technology environment   Data quality and protection Service access The workplace
Environmental factors	Sustainability   Fuel poverty
Legal factors	Financial regulation   Legal