This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.
Business Strategy means a certain kind of management procedure for increasing business, staking out a market position, attracting and satisfying customers, successfully profiting, making operations and achieving targeted objectives.
Also Strategy is the direction and scope of an organisation over the long-term which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfil stakeholder expectations. Markets have various kinds of forms to give companies a wide range of strategic choice. It is the company's choice to make decision about which strategic steps it would take to gain success in business. For example some company's have broad product lines but other company's having short product focus, some targets the high end of the market while others go after the middle or lower end. Some competitors prefers to be in manufacturing or whole sale distributing, while others are connected with operations starting from components production to manufacturing and assembly to whole sale distribution. Some companies plan is to operate in only one industry but others constantly changes industry broadly or narrowly, in to related or unrelated industries via joint venture, strategic participation or internal starts.
At company's intention to earn sales and market share using the expenses of competitors, managers very often takes the uncongenial strategies, time to time lunching new introductory steps of various kind to make the company's product more distinctive and lucrative to buyers. On the other hand steady- risk avoiding companies choose a proper defence to aggressive offence. Their strategy explains gradual gains in the market place. Company strategy results in its acts in the market place and statements of managers about the present business method, in future what are the steps company should follow and make a strong success and performance.
An example is given below to better understand and familiarise the business strategy of a company: 'Starbucks' is a coffee company which founded in 1971 in Seattle's Pike Place Market. A summary describing the aims, values, and overall plan of the company: 'To establish it as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles as we grow'.
Company Guideline Principals:
â€¢ Providing best work environment and communicate each other with respect and dignity.
â€¢ Welcoming the fact of difference as an essential component in the way of doing business.
â€¢ Applying the highest standards to purchase, roasting and fresh delivery of coffee to all customers.
â€¢ Developing passionate satisfaction to customers all the time.
â€¢ Supply positively to Starbucks communities and environment.
â€¢ Recognize that profitability is essential to company's future success.
How strategy can be constructed and carried out effectively, even by small businesses?
In order to construct a successful business strategy, company's senior manager finds out issues of what kind of way the company should follow. What kind of methods in the company's product market customer technology focus would evaluate its current market situation and future progress?
Following steps are useful to rebuild or construct a successful strategy:
To do so a company needs to focus on its beginning, to create a strategy, it will be necessary to analyze where the company started at. Need to write down the history of the business, the purpose of the organization, the mission and the business model that it follows. Along with this, determine what the strengths of the company businesses are? It is the strategic vision of a company. This is how a strategic vision points an organisation in a particular direction. It is necessary to define business goals by analyzing, this would include objects, desire, meaning what a company wants to achieve and what it visualize for the business in relating next two to five years even ten years. It should include a vision and objectives to the sections.
A company or organization needs to start building its strategy to achieve the objective and vision, where it defines how the business will achieve the goals and mission of its business and strategy. It may include things such as: what type of customer achievements it expects? How it would get the customers? What plans and projects are not working with the company? Which way the company can proceed and suggest taking steps instead?
It is vital to analyze weaknesses. Some pitfalls of business that makes it difficult to reach its desire goals known as weaknesses. It is necessary to define what these obstacles are and figure out ways to overcome them. This can include some ideas and the way the system developed. Also we can mention the organisations competitors and social activities. By building or developing steps, it is possible to overcome the weakness. Business environment will never be the same. It always changes its direction. Focusing on continuous specific tactics and development plans as necessary can be helpful to overcome such obstacles. This may include competitive advantages, as well as how business will reach the social forces that are causing weaknesses. Evaluation of the process performance and improvement opportunities are obviously valuable key to success. Combination of these steps with the strategy that has already developed internally years after year can make a huge difference on the company's plan to overcome and progress.
The Value of using Key analytical tools to help in the strategy-making process:
Key analytical tools are vital for strategy making process. Business strategy's main structure depends on key analytical tools. It provides a good over view of whether a company's overall situation fundamentally healthy or unhealthy. There are certain types of key analytical tools available in strategy-making process. One of them is SWOT analysis and the other one is PEST analysis.
By using SWOT analysis process we can generate the base for crafting a strategy that capitalizes company's resources, find out the company's best opportunities and also it defends against the threats to its well being. In general the abbreviation of SWOT analysis stands for Strengths, Weaknesses, Opportunities and Threats. The more Strengths and Opportunities the better can be seen as the bigger influences for the success of a company. Company's strengths can be describes as something which is favorable to the business. It includes good financial position, enough skilled work forces with less training required, it has its own premises or not, it has few threatening business competitions. A company's weakness can be bold with unproven skills, expertise and lack of good knowledge in important areas of the business. For example: It can currently suffer in a poor financial position with large debts. It has very few skilled workforces. Working environment is not up to date or inefficient. Market opportunity is a big factor in shaping a company's strategy. Also company's strength can represent the company's present opportunities. These can be seen as targets to achieve and exploit in the future. For example good financial position can create a good reputation for future bank loans and borrowings, skilled workforce means that they can be moved and trained into other areas of the business, Takeover opportunities are also useful when competitors going bankrupt.
A threat determines the company's profitability and company's well being. It can reveals the impact of cheaper and better technologies reflection in the current process of a company, competitors are proceeding with new improved products or not, low cost foreign business is entering into company's market strong hold or not, vulnerability in rising interest rates, changing political view and foreign exchange rates. PEST analysis reflects on the company's external environment analysis that involves political, economical, social and technological strategies. Political factors include areas such as tax policy, employment laws, environmental regulations, trade restrictions and tariffs and political stability. Economical factors are economic growth, interest rates, exchange rates and inflation rate. Social factors often look at the cultural aspects and include health consciousness, population growth rate, age distribution, career attitudes and emphasis on safety. Technological factors look at elements such as changes, motivation, automation, technology incentives and the rate of technological change within the company. PEST analysis is simple and it costs a certain time to generate. It provides an understanding of the wider business environment. Also encourages the development of strategic thinking. It also alarms the awareness of threats to a project.
How to apply such tools to the particular business context:
To apply SWOT analysis to a particular business, it is necessary to find out Company's current situation in business strategy, whether a company's overall situation is healthy or unhealthy. Whether it has the proper resource strengths, have strong core competencies or not. Also needs to find out the company's weaknesses, opportunities and threats. These four steps of SWOT analysis helps a company to find out what best suits for its strategy planning and future progress. Company's internal and external factors depend on this SWOT analysis. After findings all possibilities of a company by using this analysis the next step would be the practical diagnosis of the company's situations in to actions for improving the company's strategy and business prospects. On the basis of analysis, competitive capabilities needs to be strengthen immediately in order to boost sales and profitability or if it needs to create new resource strengths and capabilities. Also it can determine what action can be taken to reduce the company's competitive liabilities. Weaknesses which are generated by analysis needs urgent correction or not? In future business plan, company opportunities should be in top priority because they are well defined with company's resource strength and capabilities, present growth and profit. In the same time which opportunities should be ignored temporarily or permanently on the basis of its less growth progress or they are not best suited for company's future resources and capabilities. Last of all what are the steps a company can take to defend against the threats that arise upon circumstances? A company should avoid its weakest, unproven abilities or criteria where it fails to provide an attractive strategy. Company managers can take immediate action correcting company's weakness that makes it vulnerable, decreases profitability or disqualifying it from getting an attractive opportunity. In the same time company's available market opportunities and strategy needs more attention because they are attractive and best suited to the circumstances.
A PEST analysis measures the market situation, indicating growth or decline, thereby market attractiveness, business potential and suitability of market potential access. PEST analysis uses four perspectives (Political, Economical, Social, Environmental), which gives a logical structure; constructed by the PEST format that helps understanding, presentation, discussion and decision making. PEST assesses a market, including competitors, from the standpoint of a particular proposition or a business. PEST becomes more useful and more complex the business or proposition but even for very small businesses a PEST analysis can still throw up one or two very significant issues that might otherwise be missed. The four perspectives in PEST vary in significance depending on the type of business. For example social factors are more obviously relevant to consumer businesses close to the consumer-end of the supply chain, whereas political factors are more relevant to a global supplier or manufacturer.
Based on the case study, carry out an analysis of Making it Big's:
Strengths and weaknesses,
Opportunities and threats
Making it Big is a manufacturer of clothing for large and supersize women. Cynthia Riggs is the CEO and the founder of the company. She developed her business year by year and gathered experience as necessary to keep going with the company's current situation even though her educational background was not familiar to the business she established. I have included references based on the company case study. The SWOT analysis of the company is given below.
A company's strength depends on its powerful strategy, required skills and knowledge and of course a product that is totally different from the rivals. In the very beginning (1976) Cynthia Riggs was working in a women's book store collective business. There she gathered some business knowledge and developed skill which enabled her to begin a business. At this stage it was her strong achievement in business relation to keep on going. Later on she came up with the idea of selling large size cloths which is ideal for larger women. This idea is unique at that time because there were high demands of this product with few rival competitors. She believed that no one should be discriminated because of his or her size. Its worth to try when adequate clothing would contribute to better self esteem and makes the lives of fat women easier. In 1984 while she was launching a new venture, was stable with her financial resources. She had $20000 of savings and $35000 of revenue from the cheap frills business, supported her as she began a new venture. Over the four years of business, Cynthia and partner Janet contributed $42500 each to making it Big. Also she managed to extend a small credit line from a bank which was a turning point for her finance. So the competencies and the capabilities with strong financial resources really helped the business to develop. Company's CEO was keen on her strong product line and customer base. MIB developed a full line of clothing and accessories in four main categories: career wear, casual sports wear, formal and outer wear. MIB clothing sizes were 12-48 with quality assurance and with 8-10 colours in verity. To develop strong customer base, MIB has done strong advertising and promotion such as printed catalogue and mailing them to customer, web based promotion and advertising. Also radio and news papers were used to fulfil the local advertising. To make better production innovation, better product quality and wide geographical coverage -MIB employed five experienced manager, three person research and development team -duties include pattern maker, sample maker, sample cutter. Three supervisors, 10 warehouse/fulfilment/production workers. Five customer service and office personnel. Their duty was to fulfil company's requirements as necessary and keep on going with the present niche market. Experienced and capable work force, talented employees in key areas is a valuable human asset in a company. The
Company had no long term debt and also it nearly owned all of its equipment therefore it is an achievement for the company and puts in a position of market advantage. Also it makes the company to produce better quality product with low marginal cost compare to the rivals. Making it Big had a wide geographic coverage with a strong global distribution capability because of web site advertising which enabled online purchases and catalogue distribution for mostly existing customers. In 2002, MIB managed to sell nearly half of its mail order sales through the online purchases. Also most purchases were made in response to the catalogue mailings. MIB's most sale was coming from the repeated customers. Exhibit 5 shows that MIB's geographical customer profile has reached in to 100% buyer depending on location.
A weakness is something that a company lacks or does without experience or in comparison to others or a condition that puts it at a disadvantage in the market place. As we can see in the MIB's case study, the company was struggling with its main strategic direction in 2002. The sales in both retail and mail orders were decreased significantly which triggered the unexpected situation. The Company CEO was unable to detect what was the problem that triggered the situation. Cynthia Riggs was not the right professional person who can find out the symptoms which let her company losing the current sales growth market. It could be the lack of knowledge or lack of enough experience on her business back ground ability. She stated in the case study that she was at a loss as to how to achieve it and she did not know where to go from here and hesitant to invest in new projects or marketing ideas, given the current business climate. Even though she was the company CEO her activities focused only on sales and money management not on the strategic planning. She has weaknesses on circulation and marketing, difficulty dealing with employees and also she expects too much from people. The company was plagued with internal operating problems such as failing to organize management team and set a distinct goal for each area. Exhibit 7 represents the MIB's management team which points out mainly weaknesses of the team rather then strengths or capabilities. The managers were struggling to fulfil the duties assigned for them as per the company expectations. It could be because of their lack of knowledge in the areas they were assigned to or poor managerial skills that lead them to difficulties such as failing to fulfil core competences, overwhelmed by the marketing responsibilities, lack of leadership in resources, difficulty in delegating, struggles with the marketing and advertising aspects. The general manager of the company left making it Big in more complex situation by leaving the company in the middle of the struggle in 2002. This was MIB's one of the biggest problem because according to the case study staffing on the management level is the most challenging issue on that time. Internal weaknesses are short comings in a company's complement of resources and represents liabilities. Also all company's having competitive liabilities. Its internal affairs always reflect on its business planning and accuracy. A wrong or weak - Managerial sector is always vulnerable for entire company's future. Also it affects the product innovation capabilities not too sure about how well products are organized for company's key success factors. In 2002 during the hard time of Making it Big there were over 2000
manufacturers of large size women's clothing in United States and they were also producing supersize range. Mast industries with approximately $2.5 to $3.5 billion at retail was the leading contract manufacturer of regular and large size clothing with company owned facilities, partnerships and joint ventures worldwide. So this was another weakness for the company to survive in the global market with increasing number of rivals and challenging them with limited production line only based on large size cloths. Only by providing good quality product with limited production line, is hard for a company to reach its goal. Besides these it also rise the question on how well the company's higher overall unit cost will effect against its key competitors.
Market opportunity is a big factor in shaping a company strategy. Buyers demand for the existing industry's product is a kind of opportunity. Making it Big's main opportunity is buyers demand as the product was distinctive. The company was producing larger size cloths for large women. Their product line includes career wear, casual sports wear, formal wear and outer wear. There were various types of categories in product line depending on the growing crisis of the buyer as well. So this way expanding the company's product line to meet a broader range of customer need. It is clearly an opportunities for the developing company. The national centre for health statistic revealed a survey that indicates 35% of adult Americans were overweight, 26% qualifying as obese. NPD group a New York market research company reported that 60 percent of American women wore size 12 or larger and 16 percent of teenage girls were over weight. So plus size cloth sales were estimated one-fifth of all U.S and the figure was increasing with the population growth. Exhibit 6 explains data of distribution opportunities for women's apparel in the United States in 1997. So these were another opportunity for a company to expand product line on the basis of growing customer demand. The very beginning company CEO was introducing large cloths dyed in various colour and women of all sizes bought these products but it was mainly the big women who benefited the most. Besides the quality clothing was rare on large size women fashion at that time. Their choices were limited to poorly make polyester clothing and none of which was particularly stylish. She stated that they were thrilled that finally there was something that fit them. She stated that she had sold out at every fair or festival she attended. The main idea of selling large size cloths was build up from this and making it Big's strategy started to strengthen on the basis of this. From 1982 since the company's progress it started to expand new geographic market. It includes Web site advertising, mailing order, mailing catalogue, radio and news papers advertisements was also taking place in order to expand its local business. MIB's geographical customer profile explains that the company was succeeded in their product sales in various locations such as California 25.4%, North West 7.2%, South West 4.0%, Plains 2.0% and Mid West 17.6% and so on. Also the total buyer in percent of sale was 100%.Datamonitor Industry market Research, 1997 explains U.S retail sales of women's apparel by distribution channel, which indicates of succeeding on 100% of their product distribution to all sorts of stores. That includes speciality stores 22.2%, discount stores 19.4%, department store 19%, major chains 16% and many more. In 1996 MIB has launched its web site as a show case for its goods and in the following
year it added a shopping cart for online purchase. As a result, according to exhibit 4, by 2002 almost half of its mail order sales were performed from online purchases. Most purchases were made in response to the catalogue mailings. Also most of the sales were from repeated customer. In MIB's case study, Industrial expert claimed that most of the retailers simply have not figured out how to sell product to larger customer. This ability was another form of opportunity for MIB to keep the company one step ahead of the rivals. According to exhibit 7, MIB's management team was consisted of five managers with different kinds of abilities, skills and experience. Every one's duty was assigned and therefore each and every manager was aware of what their duties and what to perform as per the company's demand. Using this managerial performance, skills and technological ability- it is possible for a company to expand product lines, new businesses and increasing sales strategy.
Certain factors in a company's external environment generate threats to its profitability and competitive well being. For example slow down in market growth. Exhibit 2 in MIB's case study explains that the company's overall growth was significantly struggling in between the year 2001 to 2002. Company's mail order and retail sectors sale were not stable or satisfactory. The total sale of mail order-in state (year2001) was $338697.93 and it was $273493.74 in the year 2002. Which shows the company was down $65204.19 from year 2001's total sale. Also the retail sector shows that in 2001 MIB's total retail sale was $438254.36 and in the year 2002 the total sale was $301548.43 that indicates that the company's total annual retail sale was down $136705.93. The overall gross profit was $1,302,239.84 in the year 2001 and in the following year it was down to $848,942.95. As a result MIB's Gross profit
was $453296.89 down. Market growth may slow down in certain factors as increasing intensity of competition among industry rivals. As competition and challenges arise it makes the company's market position more critical. It also affects the company's improvisational style badly. A company's threat includes cheaper and better technologies, introducing new and better improved products from rivals, new regulation that brings more difficulties to the company than to its rivals, vulnerability to a rise in interest rates. As the competitors or rivals are taking entry to the market more opportunities or bargain situation is expectable from customer and product suppliers. Customers are always conscious to look for better quality product with cheaper price. These issues are a serious threat for a small company because it is almost difficult to manage or evaluate the current threats with investing financial resources or changing the company's overall structure with new technologies, better products and compatibility with upcoming regulations. It is because a small company's resources are very limited and in a situation like these any small company will struggle to overcome all these facts shortly. As a result profit margin can be very tight and production may also follow a slow process. Weak industry driving forces also a kind of threat for a company which is completely visible in MIB's management team. In the year 2002 the company was struggling with its managerial aspects, failing to organize a proper management team to perform well in the making of
company's future progress. The managers were struggling to fulfil the duties and requirements for the company. It is mainly because of their limited knowledge in the areas they were working or poor managerial skills which are threatening to fulfil core competencies. These problems can arise in any company in any situation but big company's can take quick action to normalize these types of problem. They can replace or hire more professional and skilled worker by using financial or other opportunities that can make strong difference to a company management, company strategy and also to its future. But for a small company like making it Big, it is almost difficult and vulnerable to make these kinds of huge changes as its resources are limited. Bridget- the general manager of making it Big left her job in the middle of the company's weak situation. In 2002 as she left, the company realised that Bridget's departure was making the situation worse as staffing on the management level is the most challenging issue for a small company like making it Big. Internal weaknesses are vulnerable threats for a company's complement of resources. It also represents liabilities. A company's internal management capabilities obviously make difference on its business planning and accuracy. A weak managerial sector is always a threat for entire company's future which affects the product innovation capabilities. Also affects how well products are organized for company's key success factors.
What needs to be done to develop and strengthen -
Making it Big's competences and capabilities?
According to the SWOT analysis of Making it Big, certain steps can be taken to develop and strengthen its competences and capabilities. As the company's managerial force was weak and struggling to make decisions- It is necessary to rebuild the organization with a strong management team. In general, without employees with good knowledge and capable managers, most company will struggle to perform the activities required for successful strategy building. So members of the management team have to be appropriate and talent based for a chosen strategy. Priority has to be given to filling the key managerial area with appropriate people who can be trusted on such things that will be done. Otherwise the construction of execution process will struggle. Sometimes in certain points of view the existing management team members are appropriate for the required task, they just need to be strengthened or expanded by introducing qualified people from the existing company or getting peoples from outside - whose experience, skills and leadership ability is better matching the situation. In the same way when a company is without the opportunity of insiders with the required experience, it is fair enough for an organization to fill the required management area from outside. Only processing a successful management team is not enough for a company. The efforts and works of every single person are also necessary to combined in order to create organizational stability. In order to strengthen the managerial and staffing skills of Making it Big, the company may start shifting or transferring managers across divisional, business or functional lines for a certain period of time. This type of transfer policy can allow managers to develop a strong relationship and understanding with colleagues in other part of the company. This type of exceptional way can avoid separately thinking and give an opportunity to share cross business ideas and best practices.
Transferring ideas and best practices from business to business can make a company healthy and vast. Making it Big can also select executives for some key positions like who are having special personal energy, the ability to motivate and strengthening others, ability in making tough decisions, straight forward in saying 'yes' or 'no' instead of saying may be. As a small company MIB's managers need to be well advanced in a procedure which managers and employees come together and discuss issues as soon as they come up, figure out the base cause of the issues and bring out quick and effective solution so that the company can move forward instead of struggling. This could be a special way of training its managers to diagnose what to do and how to do it. Every year the company can insure some development program or training sessions for its employee for a certain period of time. This way training can be an essential requirement for employees to get promotion to any professional and managerial position or any stock option award. The company may also provide
advance courses for senior managers that may focus on a single management topic for a month. This knowledge sharing not only spreads well and best practices throughout the organization; it also improves every single manager's knowledge. Managers and professionals can be graded in an annual process that can divide them in to five categories such as a, b, c, d and e. Every one in the 'a' category could be rewarded with stock award. Nobody in-'d' category would be able to get any stock award and most of them who are in 'e' category would be terminated from the company. Business heads would have to be straight forward in taking these steps. A small company can spend considerable effort in screening and evaluating job applicants, selecting only those with suitable skill sets, energy, initiative, judgement for learning and flexibility to the company's work environment and culture. Also a company can provide promising employees with challenging, interesting and skilful assignments. By encouraging employee's creativity and innovation and same way to challenge existing way of doing things and offer better ways to submit ideas for new products or businesses is a way of keeping the company up-to-date. Also a developing company can work hard at creating an environment in which ideas and suggestions forms up from bottom up rather than proceed from top down. Providing a good work environment which may allow all employees to feel safe and consider it as a good place for working. This way a small company like MIB- can build up a talent base and intellectual capital which is more important to carry out strategy execution rather than additional investments in plants, equipments and other hard assets.
Besides these a managerial process needs to be in a continuous flow although company competences and capabilities are perfect. It is specially required to refresh, updating, modifying, replacing or reshaping the upcoming environment to easily response the current marketing changes and company ability. A company also need to be careful with the production research as necessary like productions cost, manufacturing and retail price.
A small change can make a big difference in company's product line with huge customer satisfaction. After a design completion, product manufacturer can build prototypes for testing, modification and improvement.
After completing a successful testing a company can start building up its product line for customers. By following this procedure a company can estimate the future of the products and also manage the profitability of the company.
A small company can take the advantage of partnership with others in order to add competitive capabilities and develop better strategy execution for the company future. According to Vadim Kotelnikov, "Partnership is a voluntary collaborative agreement between two or more parties in which all participants agree to work together to achieve a common purpose or undertake a specific task and to share risks, responsibilities, resources, competencies and benefits. Meaningful partnerships are the foundation for success. Partnership is what enables many companies to make continuous improvements. By sharing with others, you can direct your resources and capabilities to projects you consider most important. The
80/20 Principle asserts that 80% of results come from 20% of effort. Thus, to achieve more with less, you must be selective, not exhaustive. In every important sphere, work out where 20% of effort can lead to 80% of returns. Strive for excellence in the few key areas, rather than for good performance in many. Focus your firm's resources on what you do best and what creates sustainable competitive advantage and tap to the resources of others for the rest. To decide why, when and how to partner with others for complementary resources, weight the small amount of cost savings that doing non-core-competence tasks might bring against the distraction and investment that will be required to stay up to date over time."
Introducing IT system for example adding online Information and operating system facilities in a small business can develop strategy execution and strengthen organizational capabilities with competitive edge over rivals. For example: A small business like 'Domino's pizza has computerized systems installed in each area to improve the ordering facility, inventory, payroll, cash flow and work control functions, as a result it is enabling a managers to spend more time on supervision, customer service and business development activities.' According to Joe Thorpe, "In today's highly competitive economic environment having the right IT in business is a critical element of success. All businesses deal with some of the new technology whether it is just a basic computer system or highly sophisticated software to track sales from the time the initial contact is made until they close. Finding the right IT personnel or company to provide the right systems is not as hard as it may first appear.
There are many opportunities right on the Internet to find the right IT in business helps. If sales companies are doing business on the Internet there is the opportunity to find good Contact Management Systems (CMS) and Search Engine Optimization (SEO) software. The CMS software provides sales force managers with all of the tools necessary to monitor the status of the potential sales that are being worked by the members of the sales team. SEO software is the IT in business solution to propel a business website to high rankings on major Internet search engines like Google, Yahoo, and MSN. This brings targeted visitors to the website and leads to more contacts and more sales. Businesses that fail to get visitors to their website on a regular and continuing basis are usually not going to succeed. The IT in business solutions is available and affordable for businesses both large and small. It is important to do some research to find the right company with a good reputation and that provides the services needed. Once that is done, any business can make the necessary moves to get a step ahead of the competition."
A company with a low cost provider is competitively stronger if it uses Benchmarking system. Benchmarking is a kind of process that explains and identifies best practice in combining both products and processes by
which those products are created and delivered and it also reduces cost from the business. The search for best practice can take place in both inside a particular industry and also in other industries. The objective of benchmarking is to realize and update the current situation of a business or a company in relation to identify areas and performance improvement.
How it works: It includes looking outside a particular business, an industry or a country to monitor how others performing the levels of achievements and it also understand the process they utilize. This way benchmarking helps to illustrate the activity behind the marvellous performance. By applying the idea of benchmarking appropriately, a company or organization can facilitate themselves with improved performance in complex functionality within the key areas of a business. Four key steps in applying benchmarking: The existing business process can be recognized in details. Can able to illustrate the business activity of others. It can compare the existing business performance with that of others analysed. Reproduce the ideas necessary to close the performance gap. Benchmarking should be ongoing process in a company rather than performing once. As a result it will be effective and part of an internal improvement process with opportunity to familiarise the improving best practice.
'The daily operations of accuracy and time information are also necessary when managers are concerns about the approach of strategy execution process. As a result information system covers five essential areas such as (a) customer data (b) operations data (c) employee data (d) partner or supplier data (e) performance of financial data. Every strategic performance has to be analysed and reported as often as necessary. Monthly loss and profit statements, monthly statistical summaries are replaced at once by daily statistical updates. Besides these, every minutes update performance possibility has to be monitored by online technology. Specially most of the retail company's having automated online system that generates daily sales report for every
single store and maintain minute by minute inventory and sales records for every single items. Manufacturing plants generally creates daily production report and also track labour productivity on every shift. Real time information system helps company managers to remain on top of daily operations. They can able to take action if things goes wrong, findings key performance indicators, gathering information from operating personals, fast identifying and solving problems and taking correct actions are all internal process of managing strategy and execution of proper organizational control. Statistical information gives manager feel for the numbers; briefing and meeting provide a feel for the latest developments emerging issues. Managers have to identify problem areas and deviations from plan before they can take actions to get the organization back on course, by either improving the approaches to strategy execution or fine tuning the strategy.'
How well do you think the tools and techniques for crafting and executing business strategy work for small businesses run by owner managers with limited resources (Including key stuff members)?
'The tools and techniques for crafting and executing business strategy works well for small businesses specially run by owner managers. Business strategy focuses on the actions and the approaches crafted to made successful performance in specific line of business. This strategy specially response in changing market circumstances and actively strengthens market position, creating competitive advantages and also develops strong capabilities. Consumers on markets are highly focused on price and in many situations it is giving the local law cost competitors the edge. Companies wishing to succeed in this market have to attract buyers with bargain prices as well as better products. An approach that can entail a radical departure from the strategy can use in other parts of the world.
The task of crafting and executing company strategies are the heart and soul of managing a business enterprise and winning in the market place. A strategy is the game plan management which is using to stake out a market position, conduct its operations, attract and please customers, compete successfully and achieve organizational objectives. The central power of a company's strategy undertaking moves to build and strengthen the company's long term competitive position and financial performance and ideally gain a competitive advantage over rivals that then becomes a company tickets to above average profitability. A company's strategy typically evolves and reforms over the time, emerging from a blend of (a) proactive and purposeful actions on the part of company managers. (b) As needed reactions to unanticipated developments and fresh market conditions.'
"A well written comprehensive marketing plan is the local point of all business ventures because it describes how you plan to attract and retain customers, the most crucial aspect of a business. The marketing plan is essential to any successful business. It is the heart of the business, the basis from which all other operational and management plans are derived. Marketing offers you a wealth of information that if applied correctly virtually can ensure your success. Therefore, it is important that you, as a first-time business owner, develop a comprehensive, effective marketing plan. An effective marketing plan will certainly boost your sales and increase your profit margins. You must be able to convince customers that you have the best product or service for them at the best possible price. If you cannot convince potential customers of this, then you are wasting your time and money. This is where the marketing plan
comes into play, and this is why it is so important. There are numerous advantages you can extract from the marketplace if you know how. And the marketing plan is an excellent tool for identifying and developing strategies for extracting these advantages. It can identify what is necessary and what consumer wants. Also it can determine the demand of products. It also helps in designing products that fulfil consumers need. Its outlines measures for generating cash for daily operations, to repay debts and turn a profit. This can identify competitors and analyzes products or firms competitive advantages. Identify new product areas. Also identifies new and potential customer. Allow for test to see if strategies are giving the desired results."
The academic models I have studied are not too complex but moderately complex as they are organized by various types of knowledge base books, different subjects, ideas, science, accounting, technologies, business strategy, management skills, so a combination of all types of knowledge. It is hard enough to study all this subject to gather knowledge and skills with necessary experience. But the knowledge I am getting from this can be utilized in different types of environment such as this can be suitable for large organisation like a developing business company. Perhaps it could be adapted better to smaller companies or it could work universally well. Academic skills and models help us to build up the technical and logistic part of our future involving with professional demands. As because knowledge is the only key to over come the toughest situation from any where. We can make decision or invent, produce certain kind of analytical ability which will guide us to find way out from all kind of situations. In a business company it is very necessary or important to motivate employees, customer to get outstanding performance and satisfaction. The profitability of a developing company depends on these techniques. Also skilled workers are always a priority for a well developed company. A good company can not work out complex situation without the lack of experienced employees. Skilled employee's idea needs to be valuated to the company's decision making process. Instead of taking top down approach a company can take a bottoms up approach to revaluate its decision making process that could be implemented from a company's root label such as employees from different level, categories. This way many plans, techniques, ideas and possibilities arise that can be generate and could be helpful for a small business to over come with its obstacles. Like wise the same way this ideas can generate huge possibilities in smaller companies which are run by owner managers with limited resources as well as can work universally well.
Assemble your work (the answers from Task 1-4) in to one document, with:
Table of content