Quality Management of WeWork Company

Quality Management of WeWork Company

WeWork Company

WeWork, whose parent company is The We Company, was established in the United States. It got founded in 2010 as a commercial real estate company. Additionally, the company provided other services, including work spacing for technological enterprise startups.

Nonetheless, its vision focused on the provision of collaborating short-term leases to other companies. Years later, the company ventured into WeLive, WeGrow, and Rise by We initiatives in a bid to raise apartment rentals, educational institutions, and gyms, respectively. Such investments saw the company attract a couple of interested investors who valued it at being a multi-billion, including SoftBank. Its high valuation was based on its successful definition of being a technology company, which was not the case.

The Suffering from quality scandal

Recently, in 2019, the company had a market valuation of around $ 47 billion. However, it was until August 14, 2019, when the red flags were revealed on how the company had suffered a tremendous quality scandal. WeWork’s release of the disclosure in its SEC S-1 form amid the initial public offering (IPO) and the public prospectus that month showed its poor business model, governance, and its losses, thus placing its quality management under scrutiny. The company’s stakeholders, majorly, the top management failed to ensure that quality management was closely monitored. Consequently, the presentation of the S-1 form in the preparation of selling its shares to prospective buyers to become a public company revealed several poor-quality incentives..

WeWork registered massive losses, expensive and long-term leasing contracts, a sophisticated corporate structure, gender insensitivity in appointing the board of directors, and the incapacitated chief executive officer. The company failed to provide value beyond the costs of providing its services, which is a fundamental purpose of any firm. Therefore, quality management of the company was brought down by the business model adopted. Long-term leasing was a practice that proved unproductive in the events of potential shortages of funds. Besides, long-term rental rendered losses financially because some instances require constant revenue generation to keep the company going. The company’s CEO, moreover, was allegedly promoting alcohol use in corporate settings and illegally transported bhang across international boundaries, thus undermining professionalism, which is vital in quality management.

The cost of quality, and how the company handles it

A variety of consequential impacts on the quality both financially and on human resources befell the company soon after its failed quality management. Concerning the sharing of the limelight by the press, the company lost its valuation from $47 billion to approximately $ 10 billion. Additionally, the chief executive officer, Mr. Neumann, ousted from the company through resigning in September 2019. Also, its major stakeholder, SoftBank, stepped down from the board.

We company chiefly reacted to its loss of quality, mainly through changing its corporate governance. The efforts included the transfer of funds from the outgoing chief executive officer’s real estate dealings with the firm to the company’s account. Another reaction was creating a culture to focus more on the product in the year 2020. Ultimately, a new chief financial officer, Kimberly Ross, was selected in early March 2020.

Suggestion how it can handle this better

Investing in continuous quality improvement and total quality management is essential to resuscitate the company. The philosophies create a culture of commitment to excellence in service delivery throughout the organization. They include designing ways and processes to evaluate ways to improve service delivery, including adopting the short-term business model.

Performing both internal and external audits is another potential action to improve the quality of the company. Regular inspection of the firm’s regulations, procedures, regulations, and responsibilities of individual stakeholders is essential. That way, all guidelines are monitored for adherence and misconduct by the management identified in time. Such a process will prompt members of the company to get committed to values and vision by playing their roles adequately. Eventually, the services provided will have the ability to satisfy customers.