Want help to write your Essay or Assignments? Click here
Benchmark – Strategic Planning: Action Plan
Order Instructions:
Use your completed strategy map to formulate functional-level strategy for the primary business functions included in your plan. Functional-level strategies are the action plans used by departments within organizations to support the execution of business-level strategy at the managerial level.
Create a 500-750 word action plan that addresses the following:
1.Identify which management tactics and strategies you will implement to meet your strategic goals for each of the stakeholders, departments, or business functions impacted by your plan: MBO, MBM, single-use or standing plans, competitive advantage, contingency planning, building scenarios, crisis planning, and innovation.
2.Provide an explanation of how you will apply managerial decision-making methods throughout your action plan.
Benchmark – Strategic Planning: Action Plan
Want help to write your Essay or Assignments? Click here
3.Which business functions will be impacted by your action plan? What tactics will you use to manage implementation across business functions? What can you do to enhance collaboration/cross-functionality to ensure the success of your plan?
4.Identify leadership strategies you plan to implement throughout the execution of your action plan. In particular, explain which strategies you would implement to foster team collaboration among the multiple stakeholders who must collaborate to successfully implement the plan. Why do you think these will be successful?
Benchmark – Strategic Planning: Action Plan
Want help to write your Essay or Assignments? Click here
While APA format is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.
This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.Use your completed strategy map to formulate functional-level strategy for the primary business functions included in your plan. Functional-level strategies are the action plans used by departments within organizations to support the execution of business-level strategy at the managerial level.
We can write this or a similar paper for you! Simply fill the order form!
Want help to write your Essay or Assignments? Click here
The Industry Life Cycle
The industry life cycle refers to the different stages of growth that a business in a particular industry goes through over its life. Each stage has its varying characteristics and these are expected to shift with each change of stage.
The first stage in the industry life cycle is known as the startup. The startup stage is characterized by high expectations of a wide market, wide profit margins, and outstanding performance. The second stage in the life cycle is known as consolidation. This consolidation stage is characterized by growth stability, widening of markets, reduction of unit costs, and an improvement of the quality of goods and services offered in the markets.
The third stage in the industry life cycle is known as the maturity stage. The primary characteristics of the maturity stage include a deceleration in the growth rate owing to maturing markets and an increase in the number of products offered in the markets. The fourth stage in the industry life cycle is the relative decline of the business. This stage is characterized by declining sales and counterproductive costs per unit which may not be viable to continue with.
Want help to write your Essay or Assignments? Click here
The passenger car segment of Universal Auto is characterized by a decline in the growth of the business. As such, it is in the declining stage of the industry life cycle. On the other hand, the information processing segment of the company is in the startup stage of the business life cycle owing to short life span and high growth expectations.
Product pricing for the information processing services segment of the company and the car business segment is different owing to the different stages they occupy in the industry life cycle. For the information processing business, the pricing can be flexible due to increases in demand. On the other hand, for the car business, product pricing changes are not flexible due to the declining demand for the business in the declining stage.
Want help to write your Essay or Assignments? Click here
Want help to write your Essay or Assignments? Click here
Balanced Scorecard
Introduction
The balanced scorecard is the component that is utilized for execution estimation to drive the general execution of the association. The usage of adjusted scorecard inside of an undertaking has been a vital advancement in a few nations around the globe. The utilization of adjusted scorecard picked up acknowledgment in the UK in light of the always showing signs of change business scene. An adjusted scorecard is the component that is utilized for execution estimation to drive the general execution of the association.
The idea of execution estimation was initially utilized by David Norton and Robert Kaplan. The utilization of adjusted scorecard picked up acknowledgment in the UK because of the regularly changing business scene (Wu, 2012). This paper explains the adequacy of executing the balanced scorecard inside of an association and how it can be utilized to produce new systems as apparent in administration accuracy.
The utilization of balanced scorecard bolsters the era of new systems for the firm by supporting the budgetary and operational components of the organization. Every one of the suppositions connected with bookkeeping, learning and practice and additionally moral practices of the UK organizations is likewise broke down.
Want help to write your Essay or Assignments? Click here
Ethical operations
A cutting edge environment requests that an association ought to put more accentuation on the long haul additions to upgrade their manageability to ensure that they move with the moving technological world. In this way, the business needs to concentrate on components that will promise higher money related execution of the business in the long haul premise. For long haul money related execution of any association, measures of value, efficiency, piece of the overall industry, worker fulfillment, and consumer loyalty should be exceptionally considered.
This structures the premise why Norton and Kaplan thought of the idea of adjusted scorecard to investigate the business execution in the viewpoint of money related, clients, inside procedure to ensure that all the best is attained. Once ethics program is employed for use in most of the UK companies operations will be highly improved and attaining of best performances will no longer been issue again. All activities will be run to the benefit of the poor and the rich in the society.
Following of the right corporate governance will guarantee ethic to be portrayed among many leader and the firm performance will drastically be improved accordingly. Employing the use of the right social responsibilities will ensure that balanced scorecard has been well implemented in the companies and financial matters will be dealt with accordingly. An association can be driven towards its unmistakably set objective through the utilization of BSC whereby; this should most ideal be through some different BSC parts, which include: estimation framework, vital administration framework, and the specialized instrument.
Want help to write your Essay or Assignments? Click here
BSC is utilized for imparting the required methodology all through the entire association from the pioneers to the laborers. Additionally, BSC is likewise appropriate in adjusting the individual objectives of the representatives with general business technique. Additionally, BSC is utilized as a part of adjusting and recognizing key activities that are required for use by the association with its main goal towards accomplishing its objective (Cox, 2014). There exist diverse systems in BSC that are connected regarding execution and methodology.
These systems incorporate learning and development, which help any person’s interest in learning more about the operation is taking place to grasp the concept very fast. The client viewpoint can be adjusted by guaranteeing that the representatives are prepared in the best way to serve clients for them to be fulfilled by the association’s administrations. Then again, learning and development viewpoint can be taken care of by guaranteeing that there is a lessening of holding up time in the crisis room is looked upon (Baker, 2010).
Enhancing use administrations can be taken care of by the inner procedure point of view while money related viewpoint can be taken care of by guaranteeing that all funds of the association are very much controlled. Especially, the usage of adjusted scorecard has been utilized as an administration apparatus as a part of the created nations than creating nations. In such manner, the creating nations have likewise proceeded with acknowledge the utilization of adjusted scorecard as their business administration device with the point of understanding its advantages (Tuan, 2010).
Want help to write your Essay or Assignments? Click here
Leadership
Preparation appraisal is one of the numerous standards of BSC that guarantees that the association’s authority is conferred as far as contribution, serving, and imparting where vital and seeing all that is required of them (Phillips, 2010) On the off chance that every one of these duties must be well implemented in making sure that all counting and operation are run well in then companies present in the UK.
The vital arrangement of any association is normally very much characterized under the use of balanced scorecard to actualize what is the goal, mission and all the vision set aside for the company to achieve (Brookes and Grint, 2015).
Leadership is essential in the execution and the general accomplishment of BSC. An association needs to pick up duty of initiative for them to proceed with the usage of BSC. The leaders of the considerable number of associations need to well take part in ensuring that they run their thoughts and exercises as required in their associations(Rohm et al , 2013). There is need of investigation of how then BSC operations are being transacted in ten companies to make operations work out as required. Leaders are mandated with the duty of ensuring that the right codes of ethics are incorporated in the company operations to yield to better results in the near future (Wu, 2012).
Leaders should be much concerned of how operations are taking place to cater for the needs of all in then society. Every one of the pioneers needs to plainly comprehend BSC; since, they have the command of teaching others on what should be finished with respect to BSC idea (Brookes and Grint, 2015). This will be exceptionally valuable for them in accomplishing every one of the association’s particular exhibitions, measures and increase all the backing and duty that they require to accomplish every one of their objectives.
Want help to write your Essay or Assignments? Click here
Most leaders concur that BSC offers associations to manufacture some assistance with long term maintainability. Associations need to manufacture long haul maintainability that requires enough time, responsibility, and enough assets that will bolster future exercises in the association (Brookes and Grint, 2015). The procedure of executing BSC is including, sets aside time to be an expert; henceforth, a considerable measure of tolerance is required particularly from the pioneers.
Availability appraisal is the first BSC model that involves the ID of the association’s necessities, affirming authority’s duty and all assets that are accessible (Niven, 2014). Arranging guarantees that pioneers who take an interest in the BSC group allot methodologies to BSC and complete the audit of mission that the associations need to accomplish is effective (Brookes and Grint, 2015).
Then again, specialized execution guarantees that every one of the methodologies goes into the association’s framework through programming, trainings, information solidification standards, and even through building scorecards. Association’s execution guarantees that the BSC procedure is all around actualized and correspondence is very much encouraged in the associations. What’s more, operations executed in the association guarantees that there is a high information overhaul, examination and consistent reporting of data where essential for the right changes to be finished concerning the BSC model (Pearson, 2013).
Want help to write your Essay or Assignments? Click here
Challenges of BSC implementation
There are many challenges that are currently associated with the balanced scorecard operations over the years. Usage of BSC is confronted with different difficulties like the few measures that are placed set up per every point of view (Bigliardi & Bottani, 2010). For a BSC being effective, it needs to incorporate a blend of results and execution drivers. On the off chance that there are few measures for each point of view in the middle of money related and non-monetary markers, the association is liable to fall flat in BSC execution (Weng, 2011).
Whenever an organisation receives high measure of resource usage, there might be a big problem associated with how bets the operations will be transacted. The people who initiated the use of balanced scorecard if not present in its implementation the company there tend to be a very big challenge (Diamantopoulos et al, 2014). It is due to the fact that the ones in the company are not well informed onh0w to use the balanced scorecard and guidance is needed in such a situation.
The environment under which the balanced scorecard is operated is a major challenge that ought to be well coordinated to avoid problems from occurring (Hoque, 2014). With a specific end goal to understand the adequacy of BSC, all the association in the UK needs to execute an exhaustive examination of how BSC will be actualized and utilized for their prosperity as a part of the association. This procedure is entirely includes, and individuals expected to complete the examination are not very many in China, along these lines turning into a major test to BSC execution (Gazzard, Hill & Anceau, 2011).
Want help to write your Essay or Assignments? Click here
Methodological assumptions for implementing accounting knowledge and practice
The philosophy embraced in this paper is the contextual analysis in view of the UK organizations. Throughout the years, the contextual analysis, examination has been utilized by the greater part of the scientists to give an inside and out examination that contains; oral, archival, and auxiliary based artifact of specific marvels on bookkeeping matters (Husain & Farooq, 2013). The data got from the contextual investigation involves the observational and individual information accumulation instruments of the bookkeeping learning and practice.
The contextual analysis, exploration gives a precise method for watching occasions, information accumulation and data investigation of all bookkeeping practice and learning (Karpagam & Suganthi, 2012). There are three sorts of contextual analyses that can be led with each having its own determination. To start with, there is the informative contextual analysis that is significantly utilized as a part of leading easygoing examinations of bookkeeping research and practice.
The relative budgetary position of most UK organizations before the execution of BSC is generally low (Kootanaee, Kootanaee, Hoseinian & Talari, 2013). For the second quarter after BSC execution, the money related state of most UK organizations enhanced massively. This development is still obvious in the second from last quarter and a short time later as can be seen from the incomes and the benefits. Such development can be occurring; subsequent to, the new technique utilized of BSC is effectively running. A ton of financial specialists is getting the chance to expand the estimation of their riches (Maxwell & José Dionísio, 2011).
Want help to write your Essay or Assignments? Click here
UK organization’s operations
Prior to the usage of adjusted scorecard in the UK, organizations were having issues with different venture choices that appear not to shoulder natural products. The issue could be going on because of incorrect venture choices that utilized by the organization throughout the years. This may have prompted the miscount of the normal proficiency of their operations, prompting the disappointment of their methodologies (Narayanamma & Sukanya, 2013). The operations of the board individuals are not successful, prompting pointless activities among the representatives of the organization.
Inside of the beginning quarter of the operations of most UK organizations did not yield much natural product, prompting a few missed procedures. In any case, things changed with time when the adjusted scorecard was actualized by the organizations (Northcott & Tuivaiti, 2012).
The missed systems by most organizations, enormously meddled with the operation and in addition the general capacity of the organization to understand its destinations. Then again, the representative vicinity in many organizations was not that noteworthy and this demonstrated there was the need to utilize balanced score card (Price et al, 2013).
Want help to write your Essay or Assignments? Click here
Conclusion
For the long haul budgetary execution of any association, measures of value, efficiency, piece of the pie, worker fulfillment, and consumer loyalty should be exceedingly considered. The balanced scorecard is the system that is utilized for execution estimation to drive the general execution of the association. The usage of adjusted scorecard inside of the association is extremely critical as it accomplishes money related and operational results inside of the association. The utilization of balanced scorecard can be utilized to create new techniques for the firm by supporting the money related and operational instruments of the organization.
References
Baker, R. 2010. Implementing Value Pricing: A Radical Business Model for Professional Firms 1st Edition. Wiley; 1 edition
Bigliardi, B., & Bottani, E. 2010. Performance measurement in the food supply chain: A balanced scorecard approach. Facilities, 28(5), 249-260
Brookes, S., & Grint, K. (2015). The New Public Leadership Challenge. licensed to University of Sussex – PalgraveConnect Macmillan
Cox, S. 2014. Managing Information in Organizations: A Practical Guide to Implementing an Information Management Strategy. Palgrave Macmillan
Diamantopoulos, A., Finckh, A., Huizinga, T., Sungher, D.K., Sawyer, L., Neto, D. & Dejonckheere, F. 2014, “Tocilizumab in the Treatment of Rheumatoid Arthritis: A Cost-Effectiveness Analysis in the UK”, PharmacoEconomics, vol. 32, no. 8, pp. 775-87.
Gazzard, B., Hill, A. & Anceau, A. 2011, “Cost-Efficacy Analysis of the Monet Trial Using UK Antiretroviral Drug Prices”, Applied Health Economics and Health Policy, vol. 9, no. 4, pp. 217-23.
Hoque, Z. 2014. 20 years of studies on the balanced scorecard: Trends, accomplishments, gaps and opportunities for future research. The British Accounting Review 46: 33–59
Husain, Z. & Farooq, A. 2013, “Instrument Development to Measure Organisational Change and Balanced Scorecard”, The Academy of Business and Retail Management (ABRM), London, 01, pp. 1.
Karpagam, U.P.L. & Suganthi, L. 2012, “A Strategy Map of Balanced Scorecard in Academic Institutions for Performance Improvement”, IUP Journal of Business Strategy, vol. 9, no. 3, pp. 7-16.
Kootanaee, H.J., Kootanaee, A.J., Hoseinian, H. & Talari, H.F. 2013, “The Balanced Scorecard, Alphabet of the Modern Management: From Concept to Implement”, Advances in Management and Applied Economics, vol. 3, no. 1, pp. 47-59.
Maxwell dos, S.C. & José Dionísio Gomes, d.S. 2011, “O Balanced Scorecard Como Framework Para A Acaoestrategica”, Revista Ibero – Americana de Estratégia, vol. 10, no. 3, pp. n/a.
Narayanamma, P.L. & Sukanya, M. 2013, “Traditional Balanced Scorecard V/S Modern Balanced Scorecard: A Conceptual Framework”, International Journal of Organizational Behaviour & Management Perspectives, vol. 2, no. 4, pp. 649-656.
Niven, P. 2014. Balanced Scorecard Evolution: A Dynamic Approach to Strategy Execution (Wiley Corporate F&A). Wiley
Northcott, D., & Tuivaiti Ma’amora Taulapapa. 2012. Using the balanced scorecard to manage performance in public sector organizations. The International Journal of Public Sector Management, 25(3), 166-191
Pearson, R. 2013. Balanced Scorecards and Operational Dashboards with Microsoft Excel 2nd Edition. Wiley
Phillips, J. 2010. PMP Project Management Professional Lab Manual. McGraw-Hill Education; 1 edition
Price, D., Asukai, Y., Ananthapavan, J., Malcolm, B., Radwan, A. & Keyzor, I. 2013, “A UK-Based Cost-Utility Analysis of Indacaterol, A Once-Daily Maintenance Bronchodilator for Patients with COPD, Using Real World Evidence on Resource Use”, Applied Health Economics and Health Policy, vol. 11, no. 3, pp. 259-74.
Rohm, H., Wilsey, D., Perry, G., & Montgomery, D. 2013. The Institute Way: Simplify Strategic Planning and Management with the Balanced Scorecard. The Institute Press; 1st edition
Tuan, L. 2010. ‘Balanced scorecard implementation at Rang Dong Plastic Joint Company (RDP)’ Management Science and Engineering 4(2), 92-98
Weng, M. 2011, “The Appplication of Balanced Scorecard to Performance Evaluation for Engineringing Eductaional Syatems”, International Journal of Organizational Innovation (Online), vol. 4, no. 2, pp. 64-76.
Wu, M. 2012, “The Effects of Balanced Scorecard Implementation on the Intellectual Capital Accumulation of Taiwan-listed IT Companies: Using Corporate Innovation Activities as the Moderator”, Journal of Global Business Management, vol. 8, no. 2, pp. 82-93)
Ying, J. 2010. ‘The application of BSC in China’s E-government performance evaluation’. Korea University
Want help to write your Essay or Assignments? Click here
Want help to write your Essay or Assignments? Click here
The importance of selecting a business location
Business location selection is a practice that entails finding a new business facility site. The business location is critical for any venture to realize growth as well as experience successful operations (Hair Jr et al., 2015).
The criterion for selecting a business location
Choosing a business location requires precision in market research and planning. Location selection entails assessment of the needs for a new venture and measuring them against the advantages of the potential sites. Therefore, it is imperative to put into consideration several factors when making a choice for the company’s location. The selection procedure involves steps such as; definition of the business idea, evaluation of the communities, real estate site analysis, tax incentive negotiation and finally acquisition of the site.
Several aspects are involved such as assessment of the supply chain, observation of the demographics, understanding state legislature, staying on budget and scoping the competition. Some other factors to focus on in the research include; the company needs, employees, customers, the equipment required to deliver services among others (Cavusgil et al., 2014).
Company and customer needs assessment
Talking of the company needs, most enterprises make a location choice that gives them accessibility to their customers. On this note, it is vital to consider the brand image and ask whether the location is going to be consistent with the intended brand. Establish whether the companies around are complementing or competing for the venture. It is very necessary mostly where shopping comparisons are common.
If the competitor is likely to make the environment tougher then it is advisable to shift the location. There is a need to find out whether the target area has potential employees and the rates of labor. If the business has a prospect of growth, then one should look for a building that offers room for expansion. The business should also be located at a place where suppliers can quickly find you. In cases where the customer base is local one is required to find out whether the population matches the customer profile for the business support.
Want help to write your Essay or Assignments? Click here
Find out whether the community has a stable economy for the company’s well-being. It is vital to be cautious with a community that solely dependent on a particular company for their economy since this could lead to a downturn that is not healthy for any business. One has to think also of safety too, thus, questions about the crime rate in the select area need be asked. (Cavusgil et al., 2014).
Business style of operation and the legislature
The business location should be consistent with one’s style of operation. There is a need to determine whether the intended operation is going to be formal or informal. Having the knowledge about the legislature on businesses in a given location is very essential. Look into hidden costs because not many spaces are business ready thus requiring a lot of initial work be done before start-up.
Determine also whether the select location qualifies you to access the government economic incentives. Zoning regulations; these help determine whether one may conduct their type of venture in a given building or location. This may be found out through holding the local planning agencies (Hair Jr et al., 2015).
References
Cavusgil, S.T., Knight, G., Riesenberger, J.R., Rammal, H.G. and Rose, E.L., 2014. International business. Pearson Australia.
Want help to write your Essay or Assignments? Click here
Porter’s Five Forces Model
Introduction
Starting a business or developing an existing business, it is necessary to consider the porter’s five forces to answer questions that may arise from competition. The five porters model help to determine whether a business will be profitable or not when comparing with other businesses within the same field of operation. Magretta (2013) the importance of comprehending the competitive forces and their fundamental reasons, will disclose the base of the market’s present productivity and will provide the procedure for forecasting and inducing competition overtime.
Purpose of porter’s five forces model.
The porter’s five forces study helps a company to comprehend the issues affecting productivity in a given market, help to update judgments connecting to: whether to entre a given market, whether to maximize volume in a given market and developing the competitive strategies, (Magretta, pg. 87, 2013). For example, threat of new entry to a given market is a strong force to the existing marketers in that market.
This is because a market which is productive will attract new entrants and this will eventually corrodes profitability. In order to maintain profitability, the given market will be protected by solid and long-lasting barriers to entry such as economies of scale, patents, government policies or capital requirement. Unless this barriers are implemented, the market will experience a competitive decline rate of profitability.
Want help to write your Essay or Assignments? Click here
Also, the buyer power is a weak force to determine the profitability and competition in a given market. This is because, it is easy for the buyers in a given market to drive the prices down. To do so, several factors such as importance of each buyer in the market, the cost of buyer switching from one supplier to another or number of buyers in the market, (E. Dobbs, pg. 43, 2014). If in a given specific market has few and influential customers, they are in a position to command their own terms.
Want help to write your Essay or Assignments? Click here
Strategic Planning
Task 1
1.1. Factors informing the process of strategic planning
According to Bain (2014), the success of any strategy is determined by the strategic plans put in place. Effective strategy implementation requires a clear understanding of the process of strategic planning (Favoro, 2015). The set strategies should be in line with the firm’s goals and objectives since they represent the financial strength and sustainability of an organization. It is impeccable for strategic managers to show a clear strategic path for resource allocation and decision making to get the best strategies out of the available alternatives.
The vision of a business is the representative of what the organization wants to look like in future. Additionally, a vision statement tends to provide a picture of what the organization wants to achieve in the long run. On the other hand, the mission statement is short-term and aims to provide the purpose of the organization. The mission statement shows the stakeholders the position of the organization and its capability in the near future.
The goals of an organization provide the means with which it aims to achieve its mission statement, while the objectives are the desired returns that an organization would want to achieve (Iowa, 2011). Finally, the core competencies are the main differentiating factors of an organization from its competitors. Resources, skills, and activities that competitors cannot imitate provide for an organization’s core competencies.
All the laid strategic plans must be consistent with the goals, objectives, mission, core competencies, and vision of an organization since they are the determinants of the expectations of an organization’s stakeholders. Since strategic planning involves laying the foundation for achievement of strategies with the available resources, when all the stakeholders are satisfied as per the mission and vision statement, it becomes possible to implement the strategies for realization of positive results.
Want help to write your Essay or Assignments? Click here
There are a number of issues that affect the process of strategic planning. Strategic planning is referred to as a phase-by-phase procedure with the purpose of advancing the an organization. Of the issues that affect the process of strategic planning, there are five major factors that influence the procedure. Confusion of the strategy with the plan, disconnection from the reality, ineffective strategic analysis, lack of consistent ownership, and complicating the innovative process are some of the issues relating to strategic planning.
During the strategic planning process, some plans seem to liaise with already existing policies, making the current approaches seem void and managers may do away with the strategies. In the course of the process, some employees are not involved and still, the process is intellectual and involving making the strategic managers to be detached from the real world and come up with unreal plans (Bain, 2016). When there is great involvement and use of comprehensive analysis, the process ends up with so many details that make it unattainable.
Also, since it’s only a part of employees that are involved in strategizing and planning, it can be said that the process is now owned by all the employees hence making it difficult for them to be accountable and responsible for mistakes resulting from strategy implementation (Long, 2012). New strategies bring about new control measures which eventually reduces flexibility and innovative nature of an organization. All these issues dampen the process of strategic planning and it’s up to the strategic managers to deal with them before commencing the process to avoid loopholes for successful implementation.
Want help to write your Essay or Assignments? Click here
1.3. An evaluation of strategic plans systems
The techniques used for formulation of strategic plans differ in accordance to the strategy. There is a variety of techniques used for strategic planning but the chosen technique should provide the best possible strategic outcome. The main methods used for strategic planning include; directive, command, coordination, emergent and directive strategic techniques (Iowa, 2011).
A directive technique is used in large organizations that have a simple way of doing things. The technique involves a comprehensive study of the internal and external environment for the top management to carry out strategic plans. However, if the organization is large and complex, the suitable technique is coordination where all the departments and resources are integrated together to find the most suitable strategy.
A command technique is used in small and medium enterprises where the owner or owners get involved in the strategic planning process. The owner is responsible for strategy formulation, planning, assessment, and implementation since there are few stakeholders involved in the process. A combination of internal and external team of experts is used for strategic planning in the case of emergent technique.
Therefore, the effectiveness of a strategic technique is highly dependent on the type and nature of an organization. It is crucial for strategic managers to be familiar with their organizations in order to apply the best technique. Combining the different techniques provides for application of the internal and external environment, available expertise skills, as well as associating all the stakeholders in the strategic planning for effective results.
Want help to write your Essay or Assignments? Click here
Task 2
Successful organizations understand the need to update the existing strategies as well as develop new ones to have a sustained growth. Apart from understanding the objectives, mission, core competencies, goals, and mission of an organization; it is important to understand the micro and macro environment before formulating new strategies. SWOT analysis, PESTEL analysis, and Michael Porter’s analysis are some of the main tools that can be used in assessing the environmental factors affecting an organization for the formulation of new strategies (Sun, 2015).
2.1. McDonalds
McDonalds operates as a food chain and has a presence in 200 nations. Founded in 1955, it has continuously grown in market share and revenue through diversification of products and engagement in online selling to increase customer value for maximum satisfaction.
2.2. McDonald’s organizational audit
To carry out McDonald’s organizational audit, SWOT analysis is necessary. SWOT analysis is carried out to determine the strengths and weaknesses of an organization, as well as identify the opportunities and threats that an organization faces for the formulation of a sustainable strategy for an increase in market share.
Strengths
Ever since it was founded in 1955, the company prides itself in a great market share where it has established itself in 119 countries with more than 40 million customers.
Offers a variety of products and menus for customers. The diversity of products makes the company have a sustained growth and increase in revenues over time.
Utilizes up-to-date knowhow such as online marketing to increase customer value and market share.
Weaknesses
Although the company has a sustained organization environment, its main weakness is in the product delivery after the emergence of E-commerce. It is difficult to deliver products to all its consumers due to infrastructural problems and bad weather.
Threats
Just like other food chains, the company’s main threats are:
Intense market competition since there is free market entry.
Rapid changes in consumer tastes and preferences.
Penetration of the web
Opportunities
Globalization that has created numerous avenues for expansion of the company.
Technology advancement leading to diversification of trade through e-commerce.
Want help to write your Essay or Assignments? Click here
2.3. McDonald’s environmental audit
The intention of carrying out an organization audit is to understand the market that a firm operates in. Since McDonald has an international manifestation, its environmentally friendly inventory is influenced by technological, political, legal, economic, environmental, and legal factors. The environmental audit is a global one. Through the of PESTEL model, it is possible to carry out an environmental audit on McDonald’s.
2.4. PESTEL Analysis
Some governments may encourage the company’s presence in their countries by giving out incentives while some may restrict operations hence influencing the strategies set up by McDonald’s strategic managers. Economic factors that affect the strategies set by the company include inflation, recessions, demand, and the supply of the products. Also, the company’s operations are socially affected in terms of the culture of the different market segments such that McDonald has to formulate strategies are consistent with certain cultural orientation.
There are some governments that impose high tariffs and taxes on foreign companies or reduce the rates to encourage the companies and McDonald is not left out. In addition, the strategy of the company is affected by innovations like information technology as well as electronic-commerce, which have an impact on the manner in which company operations are carried out. All these PESTEL factors influence the company and the way it formulates its strategies.
2.5. Significance of stakeholder analysis in strategy formulation
Stakeholders are the persons who are directly or indirectly affected by the operations of an organization. Like other businesses, McDonald’s stakeholders include: employees, customers, lenders, investors and the government. To effectively formulate a new strategy, it is important for a company to analyze all the stakeholders’ needs and expectations of the company (Duggan, 2014). A stakeholder analysis is a procedure used to assess and determine the effect of the key persons in an organization as well as their influence in the organization.
A company`s appraisal is considered to: decide the individuals that will undesirably or definitely have an influence on organizations operations, comprehend the influence of the shareholders on the business, and come up with approaches that are reinforced by all shareholders as well as reduce the difficulties the institute might go through when implementing the strategies.
2.6. Advantages of stakeholder analysis in formulating a new strategy
It is possible to get expertise opinions that assist in shaping of a strategy as well as gaining support for effective strategy implementation.
When stakeholders are involved in strategy formulation, an organization increases its chances of getting extra resources.
It gives a clear understanding of the opinions people have for the company hence providing room for improvement through the new strategies.
New strategy for McDonald’s
With the rapid changes that are taking place in the market, the best strategy that McDonald should adopt is e-commerce so as to increase its market share and increase consumer’s value.
Task 3
It is important that various alternative strategies are looked into before implementation. Each strategy has its advantages and disadvantages and it’s the strategy with the best outcome that should be taken (Duggan, 2013). In line with the vision and mission of Marks and Spencer, substantive growth, market entry, limited growth, and retrenchment are some of the available alternative strategies. This section outlines the four alternative strategies and recommends a strategy for Marks and Spencer
Want help to write your Essay or Assignments? Click here
3.1. Background
Mark and Spencer is a multinational retailer offers a variety of products in clothing and accessories (Mark & Spencer 2016). The company was founded in 1884 and is one of the leading retailers in the world.
3.2. Evaluation of the alternative strategies by Marks and Spencer
Substantive growth strategy is formulated through mergers and acquisition. Suppose a business if sturdy in terms of finances, then this implies that it is able to consider a strategy. Marks and Spencer has a big market share but it can merge with another firm to increase the share for sustained growth. Also, an expansion strategy exists by acquiring another business as it will be at a reduced cost and procedures.
An inadequate development approach is integrated using a joint venture thus leading to a diminished competitive edge, thus Marks and Spencer do not consider it. Reduction of cost and assets as well as revenue generation is some of the retrenchment strategies available for Marks and Spencer. The company can reduce its operation cost in Middle East. Moreover, the company should strategize on taking up extra market segments in the world to increase its market share.
3.3. Recommended strategy for Marks and Spencer
The company best alternative strategy is sustained growth through mergers and acquisition. The firm is already financially stable and strong hence is in a position to acquire or merge with other businesses in the same line. The strategy is the best of the other alternatives since it will lead to cost reduction with increased market share and sales.
Also, the microeconomic challenges faced in some of the countries can be phased out through mergers with firms that are already stable in those economies. The competitive nature of the clothing industry requires uniqueness of strategies which can only be achieved by liaising with firms that already understand the culture of the people in the various market segments.
Task 4
A strategy is void unless it is implemented. After successful strategic planning it is crucial to identify proper methods for implementation. Implementation is the final stage and the way it’s carried out determines if the strategy will be successful (Sage, 2014).
Want help to write your Essay or Assignments? Click here
4.1. Honda’s Background information
The company is multinational and operates in the automobile industry. It is the second largest automobile and was founded since 1959. The company operates globally and has sells a variety of products.
4.2.Responsibilities and roles of personnel in strategy implementation
The formulated strategy has to be communicated to the different stakeholders either formally or informally. The functions of each organization are influenced by the novel approach and needs the application of an informed communication to reach out regardless if it is horizontal or vertical.
The personnel equipped with the implementation process are responsible for mapping the strategy, integrating the organization for delivering the strategy, and carrying out the change process as impacted by the new strategy.
The personnel have the role of mapping the new strategy to the internal and external users to make them have an idea of the prospects of the new strategy to the operations and image of the organization. By mapping the strategy, the personnel will also be involved in positioning the strategy to the existing culture of the organization so that it fits with the firm’s expectations. Finally, the personnel are tasked with the change process that results from the new strategy.
The middle management and outside parties are the ones that take the responsibility of strategy implementation. The middle managers implement the strategic plan that has been set up by top managers through making sense of the strategy to other stakeholders, interpretation and re-adjustment of the stakeholders view on the strategies, and advising the senior management on the implications of the new strategy (Lewis & McKone, 2015). Shareholders are convoluted in the modification procedure and compelled to make the policy flexible as envisioned by the organization.
4.3. Resource requirements for implementing a new strategy for Honda
Resource allocation is a strategic process aimed at aligning all of organizations resources to its goals and objectives. Resources are in form of finance, human labor, and infrastructure. All these resources must be used in such a way that they lead to the achievement of the strategies.
Honda required resources are finance and human resources since it is already in possession of the materials and tools required for strategy implementation. To achieve its innovative process of generating unique products, the company needs expertise skills as well as finance to undertake the process of research and development as well as start-up capital for the new venture.
4.4. SMART targets
For achievement of strategy implementation in Honda, SMART goals must be set. SMART stands for specific, measurable, attainable, realistic, and time-oriented. A strategy should be specific and clear to avoid complications during its implementation. A realistic target is achievable and falls within a specific time frame that is also measurable and is agreeable by all stakeholders. When a target is SMART it is easily implemented and is successful in the long run (Haughey, 2014).
Want help to write your Essay or Assignments? Click here
Conclusion
Strategic management is one of the crucial functions of a business. If all stakeholders are involved in the strategy formulation process, it becomes easier to implement and the required resources are made available. A strategy is said to be successful if it’s SMART has been analyzed using SWOT and PESTEL tools. After formulation, it requires different parties to take up the process of communicating the strategy in order to integrate all the functions of the organization for successful implementation of the strategies.
Want help to write your Essay or Assignments? Click here
Transocean Strategic Management
1.0 Introduction
The paper will evaluate the strategic position of Transocean, a major player in global offshore drilling services in the oil and gas industry. Strategic management is a process that entails formulating and implementing main objectives as well as initiatives a company takes based on the available resources. It also takes into consideration the evaluation of external and internal environment in which the firm operates.
Founded in 1953, the company is headquartered in Houston Texas. Transocean administrative division has since shifted to Vernier, Switzerland for tax and client servicing reasons. Various models such as STEEPLE, Ansoff and Porter’s Five Forces will be used to paint the company’s strategic position when it comes to, macro-environmental review, competition, diversification strategy, market development, product development and market penetration. To wrap up, the paper will make recommendations regarding the direction the company has to take to remain sustainable.
1.1 Analysis of Transocean Limited
Transocean is a prominent global provider when it comes to offshore drilling services for energy establishments. The company owns and operates the world’s most multipurpose flotillas that concentrate on deep-sea and extremely harsh environment drilling (Deepwater.com, 2016). With a fleet of sixty-one portable offshore drilling components, the company offers powerful rigs for deepsea drilling. Transocean helps clients to establish and develop oil as well as natural gas stockpiles.
The company offers an exceptional drilling performance that is anchored in a solid experience that spans more than a half a century. Transocean shares are listed on the New York Stock Exchange under the acronym RIG and Swiss Stock Market under the acronym RIGN.Transocean operates more than 140 offshore rigs in almost all mainmarine markets. Apart from offering drilling services offshore, the company offersdrill management services globally. Transocean operates not just the largest extreme-deepsea flotilla of drill ships global, but it is also the largest offshore fleet worldwide.
The company hires more than 20,000 employees with the technical expertise that is the envy of their business rivals(Deepwater.com, 2016). Moreover, Transocean provides management and accomplishment services for assessment and production firms regarding offshore drilling schedules. The company’s mission is to become a leading offshore drilling organisation that provides rig-based services with a global reach, by incorporating a highly dedicated workforce,state of the art machinery and ultra-modern technology, while concentrating on technically demanding environments (Transocean, 2007b)..
The company is dedicated to values that represent its focus, innovativeness, safety, trust and reliability. The company promises to surpass not just the anticipations of theclient, but employees and shareholders as well (Deepwater.com, 2016). Transocean’s strategic goals include getting aligned with its customers when it comes to supporting and ensuring delivery of clients’ business objectives.
The company conducts its operations with distinction which is characterized by safety and efficientoffshore solutions (Deepwater.com, 2016). In addition,Transocean keeps on enhancing its corporate culture and processes to optimize returns. Lastly, the company not only attracts but also nurtures and retains the industry’s best employees.
Want help to write your Essay or Assignments? Click here
2.0 Industry Trends
Drilling oil and gas was previously dependent on backlogs. Contract bores alter their rates based on their rig charges relative to retailing oil and gas prices. Usually, contract bores tend to wait on the day down, and speedily adjust their prices upwards depending on how the markets are performing (Redall, 2012). There has been a widespread pattern of extreme deepsea rig business with strong daily charges.
However, there has been a downward trend in mid-water rig markets. The most lucrative market lies of the Gulf of Mexico and West African coastal line, down to the south of Africa. The demand for deep-sea rigs is anticipated to remain jerky in the short-term(Helman, 2015).As of now, approximately 206 floaters are operating under contract across the industry (Deepwater.com, 2016).A large percentage of the total number is idle for completing major contracts.
3.0 Analysis the different types of strategic options
3.1Ansoff Matrix:
Existing Markets
Market Penetration
Product Development
New Markets
Market Development
Diversification
Existing Products
New Products
Transocean is a dominant player in a market that is not highly saturated. However, to remain at an edge over its closest business rivals, the company has adopted different approaches. Based on the Ansoff matrix, Transocean has been using a low pricing model to penetrate the market. When it comes to market development, Transocean has been offering ultra-deepsea drilling and management services in various parts of the world. What makes the company the envy of its business rivals is the fact that Transocean’s product development strategy works magic. Apart from ultra-deepsea boring services, the company offers rig and deepsea drilling consultancy services which is certainly some form of diversification hence competitive edge.
In short, Transocean operates in the same market by adopting a horizontal strategy in terms of expanding the product line. Lastly, Transocean has a predominantly diversified portfolio. To diversify risks, the company has necessitated mergers and acquisitions when it comes to financial management and technical expertise. The company operates in various regions such as the United States, the Gulf of Mexico, the North Sea, West Africa, and Southeast Asia, Middle East and the Arctic.
3.2Porter’s Five Forces
3.2.1Competition
Transocean threat of competition is moderate to high. For example, following a merge in mid-2007 between Rig and Transocean’s chief rival Global Sante Fe, this attempt reduced competition particularly, in ultra deep-water segments. While Transocean has almost a monopoly in ultra deep-water drilling, It is likely to enjoy less competition in ultra deep-water, especially in harsh climates that require technical personnel.
In fact, this contributed to the need for anti-trust lawsuit following the merger between RIG and GSF. Nonetheless, the firm has exposure to different offshore markets such as jackupsegment that is associated with intense competition in various regions globally as well as pricing (Porter, 2008). By and large, the organisation has less competition in ultra deep-water segments, with a somewhat intense competition in mid-water floater and also jackup segments.
Want help to write your Essay or Assignments? Click here
3.2.2 New entrants
Transocean enjoys a low threat of new entrants. With respect to offshore contract drilling sector, it requires huge investment in fleet and rigs before getting inflows from gas and oil organisations (Porter, 2008). This makes nearly impossible for new firms to enter this sector.
3.2.3 Substitute
The main threat of substitute is the changing the energy source from hydrocarbon to renewable sources across the world, which is not likely in the short-run (Turner, 2007). Therefore, the threat of substitute is low.
3.2.4Purchasing power
Transocean’s purchasing power is moderate. Much as exploration and production firms have power when it comes to negotiating, especially in mid-water floaters and jackupsegments, they have sufficient ability and provision of idle rigs. In essence, the buyers are in aposition to negotiate low daily rates in the contracts while ultra deep water segments maintain stringent rates (Schlumberger, 2008).
3.2.5Suppliers’ power
The supplier power is moderate. Transocean providers have some degree of power. For instance, suppliers like National Oilwell Varco take part in the decision making in constructing Transocean’srigs andother essential parts. Luckily, this is crucial for Transocean since National Oilwell Varco has a few plans of increasing the fleet of drillships. In general, benefits from pricing since they are the main clients to themajority of their specialised providers (Porter, 2008).
Want help to write your Essay or Assignments? Click here
3.3 STEEPLE
3.3.1 Social
The organisation takes part in various social activities, including charitable contributions to developing environmental initiatives to increase its reputation.
3.3.2 Technological
Technology is necessaryfor drilling sector as such Transocean gets its strength in technological development. While oil drilling and the ecology are related, so is technology and demand. Drilling in deepwater is more and more vital from drilling organisations since they are considered to be more profitable. The firm is positioning itself to capitalize in this segment. For instance, in 2007, Transocean acquired a drillship worth USD 470m to take advantage of deep-water drilling, which allows the firm to drill up to ten thousand feet.
Due to advanced underwater drilling, there has been a decrease in jackup rigs demand (Associated Press, 2007). This presentsTransoceanwith the opportunity to beat their rivals like Noble Corporation in the struggle for innovation. Currently, the firm is leading in deep-water exploration (Katsaros & Christy, 2005).
3.3.3 Economic
Cost is a major challenge for drilling organisations. As oil price rises, the cash flow increases too, which makes organisationsinvest considerably in drilling activities? Furthermore, the new techniques of recovering oil though they are essential in the growth of petroleum production, are leading to an increase in the gasoline price. Implicitly, thehigh price of oilis required to make drilling firms profitable. High global investment drives drilling.
With great interest to drill in foreign regions, global investors are significantly investing, hence leading to expansionof oil and gas sector (Maksoud, 2007).Even though raising oil cost will adversely influence Transocean, in reality, will be beneficial in the long run. Oil cost is inelastic. In other words, afluctuation will insignificantly affect demand. Therefore, increasing oil prices willboost cash flow for Transocean, which means additional business like funding new drilling projects.
3.4.4 Environmental
On environmental protection, Transocean is committed to enhancing its stringent police on Environmentalmanagement system (EMS). Transocean’s EMS visitation is conducting its operations in a standardised manner that fulfills the high levels of stipulated laws to drive continuous enhancements while instilling ownership across its facilities (Transocean, 2007a). The organisation is environmentally sustainable by way of using green products and assessment is utilized as part of routine operations.
The firm also focuses on recycling. Additionally, Transocean has set up a recycling plan, where recyclables are sorted and compressed in rigs. After compression, they are transported to Tech Oil Products and donated to a recycling hub in the ARC of Iberia.
Transocean has collaborated with different oil and gas firms such as Subsea 7, and BP in the SERPENT project. Thisentails necessitating access to the installations, in partnership with their customers to present scientific knowledge to experts in the SERPENT project (Dictionary.Cambridge 2012). In turn, the analysts conduct various projects including assessing biodiversity and effects of drilling on the environment.
The analysts also work on the company’s rigs to study marine species (Transocean, 2007a). By and large, Transocean protects the environment in which it operates to demonstrate that the company recognises the consequences of natural demand shifters.
3.4.5 Political/Legal
Oil presents this organisation with a strong political force. Because oil is the primary source of energy internationally, thus, the supply of oil is related to power regardingpolitics; oil firms leverage authority over regimes (Dictionary.Cambridge 2012). With no oil organisations, United States is likely to lose its dominance in developing nations remarkably. Though oil drilling firms are fundamental in giving regimes the authority, they are still regulated and work as per government laws, such as prohibiting drilling in particular regions like the Gulf of Mexico to protect the environment.
In 2007, the Congress was promoting the closure of a quarter-century ban on the production of offshore energy. This decree banned 85 percent of all drilling in United States’ continental shelf, greatly affecting oil drilling firms including Transocean (Kamalick, 2007). Furthermore, the Congress were supporting the opening of additional shorelines, which was associated with renewable sources of energy, as such they sought for support from environmentalists. While regimes exercise their authority on oil and gas providers, these providers, in turn, have authority over the very regimes.
Want help to write your Essay or Assignments? Click here
3.4.6Ethical Standards
Transocean aspires to ensure financial discipline in their disclosure, honesty and candor in all their engagements with clients, ahigh esteem for employees, customers and suppliers, the safety of employees, property and the ecosystem and technical leadership. Loyalty to these core values demands the company to execute its operations in tandem with thelaw and the utmost standards of business ethics.
In advancing that objective, the company embraces the Code of Business Conduct and Morality, the firm’s environment is also a corrupt free zone and an Anti-Corruption and Business Conduct Policy takes care of that. Again, directors and employees are not allowed to enhance the culture of inside trading. Nonetheless, all employees should adhere to the privacy policy.
4.0 Recommendations
Since oil is directly associated with international authority, oil drilling organisations have authority over regimes, nevertheless, with another alternative, Transocean should continuously go this direction to maintain the lead if the primary source changes
Much as the company has advanced drillship tools, it should take a notch higher by researching new products in comparison to its rivals.When it comes to maintaining competitiveness in oil and gas industry, Transocean should use differentiation strategy that will be vital in developing clients’feedback and service delivery. The differentiation strategy should focus on quality rigs, particularlydeep-water drilling and ability to survive environmental disasters such as hurricanes.
While this threat of substitute islow, in future it may reduce the demand for oil. For that reason, Transocean should create awareness among clients about the benefits of oil in comparison to other energy sources. This can be carried out through advertisements. For instance, the organisation should use ads that demonstrate even with the use of alternative sources such as ethanol, which is considered environmentally sustainable compared to oil. Ethanol requires aconsiderable quantity of biomass. In the even that US, ethanol from corn is employed on a large scale, then it will contribute to increased costs of corn.
The prices of beef will also skyrocket remarkably as cows feed on corn products. On the other hand, if Brazilian corn is used thatis produced from sugar; rainforests in the region will be cut to provide land to grow sugar. Creating awareness through ads will help Transocean increase the demand for oil while increasing the demand for petroleum products from the company.
The company should embrace Ansoff model to diversify its portfolio. Instead of concentrating on drilling and consultancy, the company can take a leap of faith and venture in other business like marine transport, finance, healthcare, real-estate, heavy metal processing among others. Diversification is critical because it will help the company spread risks, when oil business is at its low.
Want help to write your Essay or Assignments? Click here
5.0 Conclusion
The study set out to evaluate Transocean position in the offshore drilling services. The company’s background, values and strategic goals were highlighted at the outset. To understand the company’s product and market development; market penetration and diversification, the Ansoff Matrix was used. The Porter’s Five Forces were employed to establish the intensity of the competition. However, STEEPLE model was used to evaluating the company macro-environment. In the end, the paper touched on the best practices as assured by ethics codes. Recommendations were made regarding the corporation’s future.
6.0 Bibliography
Associated Press 2007. JP Morgan Securities analyst upgrades GlobalSantaFe, Transocean to “neutral.” Retrieved 17th March. 2016 from Factiva.
Berman, A. 2007. Drilling advances. World Oil, 19. Retrieved March 17, 2016 from Business Source Premier Database
Deep Sea Drilling Project 2015.” The Columbia Encyclopedia, 6th ed.. 2015. Encyclopedia.com. 17 Mar. 2016 <http://www.encyclopedia.com>.
Want help to write your Essay or Assignments? Click here
Promotional Strategies
MistAway Case Study
MistAway is a mosquito misting system that is designed to control mosquitos and some other troublesome insects from one’s courtyard. It is a permanently installed system that kills all mosquitos within its perimeter all year round. To ensure that MistAway is familiarized and is used more than the other methods of mosquito control, the manufacturers have employed a number of promotional strategies. The push and pull promotional strategies have been used intensively through Mistaway.com website.
MistAway Company guarantees installation services to their customers, which is an example of Push promotional strategies. With this type of promotional strategies, a seller gives offers so as to attract customers, something which they have effectively done through their installation programs. Through the dealers, customers are guaranteed of consistent maintenance services for their systems. A pull strategy is yet another intensely used promotional tool, as MistAway manufacturers use advertisement to a great extent in luring customers to use their services. With this approach, the seller creates a need so that buyers find it necessary to use their services. MistAway manufacturers show a number of videos about the effectiveness of the system as compared to other methods. Besides, they have educational videos on the advantages of the system and why individuals should install it in their backyards.
The use of pull and push approach is effective in serving the marketing strategies of MistAway manufactures. Teaching people about the utilization of particular technologies, and helping them see the effectiveness raises their demand for that product. Further, guaranteeing of assistance regarding maintenance and installation services reduces their cost.
MistAway manufacturers could be targeting homesteads and other institutions as hotels. Provision of outdoor mosquito control is a good idea for places that are designed for providing comfortable and serene environments.
Though the strategies used by the MistAway manufacturers is valid, it may not be sufficient for them to reach a wider market. The website-based advertisement may not arrive at a large number of potential users, which limits their organizational targets. So as to have an improvement in this aspect, the company may employ other platforms such as social media, televisions, and others.
Healthcare marketing activities and strategies should be unique from other forms in the sense that they should be focused on patient and user outcomes rather that profit making. Healthcare marketers should give priority to the welfare of patients and the whole population. It should not be carried out to lure persons to use services that are not designed for them. Accountability and care should be an essential part of all healthcare advertisements.
Laureate Education, Inc. (Executive Producer). (2010). Strategic planning and implementation: Strategic planning in action: Good Samaritan Hospital of Maryland. Baltimore, MD:
Want help to write your Essay or Assignments? Click here
Chase strategy on the other hand involves the idea of companies balancing production capacity and the demand from time to time. This strategy can involve the hiring and firing of employees with changes in demand. The strategy may result to unhappy employees due to the high rates of layoffs (Olhager, 2013). However, many firms are able to save on costs since inventory can be held as low as possible.
From the given data, the cost breakdown when chase strategy has been used can be represented as below.
Month
Demand
Production
No. of Extra hired workers
Total cost arising from the added workforce (in $)
January
600
600
5
5,000
February
700
700
10
10,000
March
800
800
15
15,000
April
700
700
10
10,000
May
600
600
5
5,000
June
500
500
0
0
July
600
600
5
5,000
August
700
700
10
10,000
September
800
800
15
15,000
October
900
900
20
20,000
November
700
700
10
10,000
December
600
600
5
5,000
Totals
8,200
8,200
110
$ 110,000
When chase strategy will be used in this scenario, the demand of the products will coincide with the production level. This was due to the ability of the firm to hire new workforce that will ensure that there will be more production that meet the current demands of the consumers. Every extra employee can be able to produce 20 extra units every month.
Since there will be 110 employees who would be required to fill the gaps, then a total of $ 110,000 would be needed to compensate them. Since there will be 110 employees, each producing 20 units in a month, there will be a total of 2,200 extra units that will be produced by the extra workforce. This would not be the case when the level strategy will be applied. It is an added advantage and profit for the firm.
Level Strategy
Level strategy in production involves the kind of plan that seeks to maintain a stable production rate or employment level. Companies must either lower or raise inventory levels as they seek to satisfy the demands emanating from the consumers (Olhager & Johansson, 2012). When the demand is deemed to be low, the firm maintains a steady workforce and a constant rate of output.
Through doing this, the firm will be able to achieve a higher inventory level than the amount that will be presently needed. Even when the rate of demand is increasing, the firm still will continue to maintain a steady rate of production and still be able to use the surplus from the inventory as a means of handling the increase in demand. One of the alternatives used by the level strategy is the use of backorder or backlog (Bevly et al., 2016).
In this case, the firm may promise to deliver the units or products at later stages when they will be readily available. The level strategy is usually used by firms that aim to meet their demands while at the same time maintaining their output. When this strategy is used several issues come up. For instance, there is always the cost of excess inventory, overtime costs, as well as the loss of goodwill from consumers.
Month
Demand
Production
No. of Extra hired workers
Total cost arising from the added workforce
January
600
700 (200 from inventory)
0
0
February
700
500
0
0
March
800
500
0
0
April
700
500
0
0
May
600
500
0
0
June
500
500
0
0
July
600
500
0
0
August
700
500
0
0
September
800
500
0
0
October
900
500
0
0
November
700
500
0
0
December
600
500
0
0
Totals
8,200
6,200
0
0
For the level strategy, the production and workforce are fixed. Any extra units produces will be stored in the inventory awaiting the high season. The demand was 8,200 while the firm would produce only 6,200 units. There is a deficit of 2,000 units which will be needed to satisfy consumer demands. This is a massive loss in case this strategy was used. In case the company would have agreed to be flexible in their business activities, hiring workforce as well as increasing production would produce a positive change in the financial returns.
Conclusion
From the analysis, chase strategy seems more profitable than the level strategy. However, the concept of hiring and firing workforce seems unethical. From a firm’s perspective, though, the technique can be very valuable to produce grater profits than the level strategy. From an insightful perspective, a combination of the chase and the level strategy can be very effective in meeting organisational policies and goals. This can be termed as a hybrid or a mixed strategy approach. It can assist the firm to meet the required demand while at the same time lowering the costs as opposed to the use of pure chase or level strategies.
References
Bevly, D., Cao, X., Gordon, M., Ozbilgin, G., Kari, D., Nelson, B., & Redmill, K. (2016). Lane Change and Merge Maneuvers for Connected and Automated Vehicles: A Survey. IEEE Transactions on Intelligent Vehicles, 1(1), 105-120.
Olhager, J., & Johansson, P. (2012). Linking long-term capacity management for manufacturing and service operations. Journal of engineering and technology management, 29(1), 22-33.
Want help to write your Essay or Assignments? Click here
