William Garden a small business which started about 20 years ago with 40 employees according to the case study became very popular producing variety of Garden benches and chairs and sell to departmental stalls and other garden centres. At the William Garden Furniture, the internal strategic issues and forces that was imparting on the business in my opinion are the owner manager’s lack of managerial capabilities and formal marketing experience, financial problems, communication and advertised functionalities. Williams, (2009)
The study of micro environment is describe as Cosmic analysis macro analysis is describe as Pestle analysis. Both Micro and Macro environment cover the general environment of businesses which i more complementary rather than contradictory. The study of these environments would enable one to know the strength, weakness, opportunity and treat of a business.
Fig1: Micro (Internal) and Macro (External) environment of a business.
When a business organisation is in direct contact with its environment, it is referred to as Micro environment. Micro environment can affect the routine activities of a company and its elements or internal environment include retailers who make a link between the company and the customers. Other elements of the micro environment are wholesalers, distributors and the company itself. The company itself comprises of owners, board of directors, shareholders or investors and employees. Hence micro environment is a collection of all the forces that are close to the firm. These forces are very particular to the mentioned firm only and can influence the day to day activities and performance of the company but only for a short time.
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On the other hand, Macro environment comprises of the external factors that are not under the control of the company though they have a strong impart on the company’s functioning. Macro environment is the universal environment within the country that controls the working, decision making, strategies and performance of every business groups at the same time. Macro environment is active and as such keeps on altering at all times. The external or macro environment is also known as the PESTLE analysis and PESTLE stands for variables that exit in the environment. These consist of Population and Demographics, Economic, Socio-cultural, Technological, Legal & Political and Environmental analysis and it considers both economical and non-economical factors like social concerns, government policies, families structure, population size, inflation, GDP aspects, income distribution, ethnic mix, political stability, taxes and duties and all the rest. The general environment within the economy that influences the working performance, decision making and strategy of all business groups at the same time is known as macro. This is dynamic in nature and therefore keeps on changing. It also constitutes those outside forces that are not under the control of the firm’s but have a powerful impact on the firm’s functioning. This consist of individuals, groups, organisations, agencies and other and others with which the firm deals with during the course of its business.
Main Differences between Micro (Internal) and Macro (External) Environment.
The major differences between micro and macro environment are:
- The factors of the micro environment affect a particular business only, but the macro environmental factors affect all the business entities.
- The surroundings, that are in direct contact with the business is micro environment whilst the surroundings whichÂ is not specific or direct in contact to a particular firm but can empower the working of all the business cluster is known as macro environment.
- Whereas macro environment is the external environment, micro environment is also known as internal environment of a business.
- The micro environmental issues are controllable by the business and on the other macro economic factors are not controllable.
- The fundamentals of the micro environment affect directly and regularly to the firm which is just opposite in the case of the macro environment.
The main economic factors that can have effect on a business are labour, labour cost, interest rate, government policies, taxes and management.
Looking at the case study of the William Garden Furniture, the strategic issues and forces impacting the business was both micro and macro factors. The company was facing micro factors in that in that within the company there was ongoing discontent among the workers. When workers are not happy and satisfied with their jobs and begin to grumble they leave the job to other places where they will be satisfied with what they are doing. This means WGF have to recruit and train people to train people again and if the problems persist the company will have to train new workers frequently. This will affect the finance of the company. In my opinion what WGF would have to do is to shift the functional managers around frequently. Also the workers should be allowed to bring out their grievances for the company to sort them out. The workers must also join the union so they can feel safe at the work place. In the case study there were also high levels of sub-standard product returns causing wastage of raw material. With such a problem WGF is going to lose money due to wastage, most of their clients will also lose confidence in them and stop business with them, Apart from these problems that WGF was facing there were other problems like deteriorating of quality retail outlet, erosion of actual growth process and dilapidated state of equipment and machinery. Also the owner manager, Martin William was facing problems with his managerial capabilities. All these problems as I mentioned earlier on were micro (internal) factors affecting William Garden Furniture.
Small businesses always face realistic distinctive problems. Most of these problems and struggles can be drawn from owner manager-related character and limitations, size-related characteristics and limitations, owner manager attitudes, values, motivations. All of these can restrict the use of external finance and he employment of additional external expertise. Workers, functional managers and even skills may end up facing marginal labour market problems. Owner manager abilities may be discourage in the face of fast growth and inherent new development problems. More also, on the macro (External) factors, in WGF there was lack of collateral or profit track record. This can cause restrictions in raising growth funding, resource and ability restraints in the company.Â All these were seen happening in William Garden Furniture. Again in marketing WGF would have difficulty in obtaining market information and entering established distribution ways. Due to the internal and external problems WFG is facing, there would be difficulty in settlement or negotiating of short run suppliers at a good price. Such situations can confuse WGF or any small business operation, the benefits in the smallness of operation can affect future benefits.
According to Owen, Northcutt, Dietz (2015), the main duties of a consultant in every business is to help its clienteles or clients to understand the systems to which they belong in other to help them improve some aspects of individual, process and organisational performance. These with a classic strategy to collect data and provide some kind of good interpretation as to its meaning and significance for the business would be of great help to the business. William Garden Furniture has been established for 20 years. They also have 40 employees. The business became well known producing a variety of garden benches, tables and chairs. They sell these furniture to departmental stalls and other garden centres. The business became well known under Martin Williams (The owner manager) and other functional managers management and leadership. From the case study the business became well known and was moving through the stages of growth. There was little confidence in Martin managerial capabilities because of rate of growth. Again there was also little trust issues for those in leadership roles. I will perceive WGF did not value workers opinions nor genuinely care for its employers as there was little openness. I believe even if there is human resource at all, systems were rated with hostility, especially when it comes to payment and compensation to both workers and clients. I also believe performance management and due process were not treated properly. Furthermore the business was facing realistic distinctive problems every small business go through during growth. There was struggles from Martin in owner related character and limitations, size-related problems and limitations, owner manager attitudes, values and motivations to business from Martin Williams. On the external factors, there was restricted resources, revenues and tax related problems. The business was affected by financial problems because the UK economy was also beginning to have growing demands on domestic interest rates. According to the case study, Martin was aware of the pressure on domestic interest rate but powerless to do anything in that the company was extremelyÂ dependent on extensive over draft and significant long terms loans.
Handing over certain duties and powers to other people was difficult to Martin due to the fact that he had run and managed the business for 20 years. These problems happening all the time caused him sleepless nights and at long last Martin the business owner lost hope for his business and was unsure about the business growth and sadly became dispirited because the good reputation of the company had declined and over time the potential for promotional prospect diminished. Financial inconveniences were worse that even when the business needs any borrowings outside of the company finance, it was impossible because the business has utilised all its existing business grounds.
According to Coetsee, (2011), if a business has only few employees, the business or company knows whether the employees are engaged or not. There is often a gap or a disconnect somewhere between senior management and employers and for organisational effectiveness one must help the business to improve their engagement levels.
Making sure workers are happy, engaged and enthusiastic about their work does not just benefit them and for a proven link between engaged staff and organisational performance companies need to take on employee engagement as a strategic policy. Study suggest that engaged employees perform 20% more effectively, generate 19% more of operating income and 16% more profit margin growth. They are in addition 59% more innovative and 70% more understanding of how to meet customer needs. It take 57% less sick leave and are 87% less likely to leave their jobs. These figures sound very impressive but researchers estimated also that fewer number of workers are actively engaged whilst more than 20% of workers are actively disengaged.
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To be aware and understand the future of management it is vital to first understand the past. One cannot established a successful future oriented and socially know how business of tomorrow when they don’t really understand why new management approaches are fashioned. Martin had trouble dealing with change because he might have assumed that his business will be reasonably stable, unwavering and reliable, likewise many owner managers find it difficult and always impracticable to achieve the speed and flexibility required to keep up with or get ahead of changes in the business environment.
According to Worley, Christopher (2011), command and control organisations and High Involvement Organisations have trouble dealing with rapid change due to the fact that they both assumed that business environment will always be stable. In the mind of most managers there is the certainty that change is the enemy and that by remaining stable and unchanging financial success can be achieved better.
When William Mc Gregor wrote about Theory ‘Y’, he argues that when people are involved in making important decision and given interesting work, they are exceedingly motivated and committed to organisational success. He explain also that the idea that the command and control organisations (CCOs) are designed, decreases the motivation of individuals and creates dysfunctional adversarial or rival relationship between employees and the company.
In order for William Garden Furniture to be effective, there must be a new management approach. WGF must build a business that values change. Again the workers must have the capability to implement strategies, generates profit, support the welfare of the people and the environment.
WGF must create a world of sustainable management with business more adaptable and lively and more outward looking, more effective and be able to address the demands of its stakeholders. It must be more innovative and more proactive where workers are down to business all the time. The company through its workforce should remain effective, perform successfully in people, profit and the planet and should also practise valuable effective sustainability of the business.
More also, WGF must generate sustainable outcomes and act responsibly towards all its stakeholders by making sure decisions are made with social and environmental outcomes so that the desire of profit alone does not compress the planet and the workers and the customers as well. Work must be very well thought out, management processes, the structure, work process need to smooth the progress of innovation and carrying out teamwork and competence. To achieve these there must be high levels of contact between employees and everyone who is concern in the well being of the company. Also management must take risk, be adaptable and innovative in many ways so as to keep abreast with time. They must put into operation potentials that maintain and hold up to change. Martin the owner manager must allow for the company to be skilful and at the same time professional, hence values has to be created to generate a mishmash of social, economical and environmental value by addressing the companies short term threats and opportunities. Workers must be treated appropriately since this is very important to the success of the firm. Work must be planned and premediated to be flexible an receptive to change.
Also considering small firms, from production to finance to personal entrepreneurial marketing, plans are mostly based on contribution on every aspect of the business and in order to succeed, start-ups business should work in a coordinated way in order to make use of the business resources as powerful and professionally as is possible. Decision makers on marketing must replicate and echo the real nationwide or global situation facing the company. Entrepreneurship recently has been studied as its own discrete class of business. There has been remarkable and amazing success of some small companies which revealed that entrepreneurship possess its set of business with many exclusive braveries, challenges and prospects. Because of these challenges and prospects, specific strategies for successful entrepreneurship have started to emerge at the same time entrepreneurship have received many spot light and competing against larger companies that are better know and more resourceful in the main challenge facing the entrepreneur. How can a company like William Garden Furniture with its staff of 40, limited budget and a small customer base, hope to compete against the giants in their industry? In my opinion, this could be don e by turning their weaknesses into their strengths an d by their very nature, start-ups companies can be more flexible and untraditional than their major competitors. When a company determines several aspects about their brand image, then it is the time for marketing plans to be developed. When marketing plans are developed the company must understand their main mission, who their competitors are and which customers they can target. Also to help an emerging business define their place in the market so as to set realistic goals, a company must make a careful self analysis. The type of business a company strives to be will also affect its marketing decisions. For instance if a company that import fruits like pineapple decides that it will market to noly supermarket stores, it will never use funny viral videos on YouTube to market its products.
One of the best ways for emerging companies to define their brand image in the mind and heart of consumers is by marketing because marketing is a tool that has been available to most businesses willing to invest in it. Marketing is an area where entrepreneurs do describe an exclusive identity about themselves. For all the clever advertisement that come out from the internet start-ups for example, Zaphos.com was able to turn a simple product likes shoes into a nationally recognisable product. Entrepreneurial marketing is all about a marketing spirit that differentiates itself from conventional or traditional marketing practises. It has nothing to do with many of the fundamental principles of marketing because entrepreneurial marketing are typically designed for large and well established companies. Sometimes it utilizes a toolkit of fresh and untraditional marketing practises to help up-and-coming firms gain a footing in crowded markets.
Generally, the most familiar qualities of entrepreneurial marketing are, innovation, risk taking, and being proactive. Their campaigns and promotions try to draw attention to the company’s greatest strengths and at the same time emphasise their worth to the consumer. When a business focuses on innovative products, and very good customer service, they stand out from their competitors.
It can be easy to get lost in the crowd and so in competitive markets the main challenges for entrepreneur is to have a good reputation and standing out from other competitors since one can get lost in the crowd. The greatest way to demonstrate what makes a business exceptional is by marketing in unusual, new and forceful ways having a focal point on building a physical powerful connection between the company brand and client or consumer. This is known as relationship marketing. When marketing powerful tools like emails and social networking must be implemented to support marketing efforts. All marketing efforts must be personalised in that customers are marketed to as individuals. There must be the command of technology to utilise and interact with customers and a real time one to one marketing with customers.
Furthermore, marketers must make sure there are messages on the internet in order to be shared and spread out by customers. Consumers must get involved in fashioning markets and developing innovative products. In order words there must be leaders instead of followers. To make one’s business prosperous, fruitful and thriving and stand out in the crowd and be notice the business must defineÂ its customers, offer something new frequently, go to where the customers can be found like trade shows, events, reading magazines and other avenues that will help your business to be nationally and internationally known. There should also be exceptional offers like service delivery to customers doors, 24/7 technical support so as to keep the business ahead of competitors. Marketers could utilise inexpensive and handy tools like tweets, facebook pages, viral videos, instagrams, Skype, email marketing and any marketing strategy to generate very great result for the company.
As a consultant these are the advice and inspirations I will give to William Garden Furniture and any other company that come to me for advice in order to raise their company to the next level.
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