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Introduction
Background
Managing responsibilities and tasks is becoming increasingly more difficult in the contemporary environment. With the introduction of new tools for communication and the new means of connecting people, IT innovations often pay lip service to their owners by cluttering their free time and preventing them from organizing their daily routine in an adequate manner (Lee, Adulbek, & Nam 2016). Herein lies the importance of the company that will provide people with an opportunity to rearrange their responsibilities in a more reasonable manner and have more free time.
The concept of a concierge is not new; in fact, their services have been used for centuries. However, it should be noted that concierges have been featured in the hospitality industry for the most part. As a rule, a concierge is viewed as a member of the hotel personnel. The reasons for the identified misconception are quite obvious; however, the misinterpretation of a concierge as a profession, as well as the disregard for the opportunities that the evolution of the image of a concierge will open, is beyond deplorable (Toedt 2013).
Therefore, it is expected that the company aimed at providing the services of a personal concierge is likely to get enough attention to gain a significant number of customers and become successful in the target market. One must admit that the road to success is going to be quite complicated. Indeed, since very few companies have been engaged in the target business, Personal Concierge will have to blaze its own trail to a global triumph. Nevertheless, it is expected that the company will receive acclaim as a one-of-a-kind service in Dubai that helps make people’s lives easier by providing them with an opportunity to be relieved of some of the pressure.
Rationale
The reason for choosing the identified domain is rather evident. Being a comparatively young industry, the business related to providing personal concierge services is very promising as far as the competition and the company profits are concerned. While the firm will have to be careful with its pricing strategy to make sure that people are willing to purchase the services, the process of designing the appropriate pricing strategy is going to be rather loose.
Apart from the novelty factor and the chances that the new industry opens in front of company owners, the fact that the concierge service will help build connections with partners operating in a range of areas deserves to be mentioned. Because of the nature of the service,
Company Summary
Mission
The mission of the company is to make people’s lives easier by offering high-quality services of personal concierges, as well as maintaining staff satisfaction rates high and making sure that the needs of all stakeholders are taken into account.
Vision
Personal Concierge sees the world as the place in which people are capable of enjoying their professional and family life. The environment, in which people are content with the way in which their professional and personal lives are organized is a possibility once Personal Concierge offers its services in the target market.
Objectives
The short-term objectives include entering the environment of the Dubai economy successfully and attracting customers. Among the long-term ones, the regular improvement of the service quality and the design of the application that will help make the process of ordering the corresponding services easier needs to be mentioned.
Service: Description
The concept of a personal concierge is a fairly recent addition to the list of services provided in the environment of the Dubai economy (‘Waldorf Astoria set to open in the Middle East’s leading financial district’, 2016). Nevertheless, there is a list of standards and quality requirements that apply to the identified services. While the definition of a personal concierge is rather loose, it implies that the necessary services should be provided in a timely and efficient manner.
The responsibilities of a personal concierge include running errands and arranging the crucial processes and events in the business or personal life of the employer. As stressed above, the list of tasks and the number of areas in which a personal concierge will assist the employer is truly ample. For example, the requested services may include booking a room in a hotel or a plane ticket to London, arranging a promotion event or a birthday party, etc.
Furthermore, it will be the responsibility of a personal concierge to keep the identified tasks clear and organized. At this point, the line of areas in which a personal concierge will operate aligns with the ones of a secretary. However, apart from the tasks that would typically be included in the list of the latter, a personal concierge may also be assigned with paying bills, doing personal shopping, and, practically, performing any task that the employer will request and that lies within the boundaries set by the legal system.
Therefore, the range of services offered by the organization will expand as the firm evolves in the target environment. Furthermore, the staff members will be encouraged to acquire new skills and develop new competencies that will help manage an increasingly large number of responsibilities. At present., the company will aim at providing the target customers with business-related services, as well as the ones related to household chores, as well a the arrangement of events for families. However, as the organization grows larger and the target audience becomes more diverse, other services will be included.
Market Analysis
Size
A closer look at the target market in Dubai will reveal that it is, in fact, quite new. Although the idea of a personal assistant that could help arrange the essential events is not new, the suggestion to embrace every single domain of one’s life, including the personal and the professional aspects thereof is quite innovative. Therefore, it is very likely that the company will be able to attract a range of customers within a relatively short amount of time. Indeed, according to the latest information on the subject matter, the personal concierge services are in their growth stage of the product cycle (Innomen & Saaksvuori 2013).
Indeed, if considering the general concierge services as the introduction of the product to the target market, one may assume that the identified service is currently experiencing consistent growth. At present, there are 705 companies operating in the identified environment, with 2,646 people being employed, according to the 2015 data (Ibis World 2015).
Growth Rates
According to the official statistics released in 2015, the market for personal concierges has been experiencing rapid growth over the past few years. The growth rates make 4.3% currently, which is quite an achievement for a comparatively young industry (Ibis World 2015). Moreover, it is expected that the market is going to grow exponentially within the next few years. The reasons for the expectations concern the possibility of transferring the services of a personal concierge to the digital realm.
The opportunities for online payment, as well as the design of smartphone applications that will help arrange the target audience’s schedule, keep their notes in order, and keep in touch with the personal concierge assigned to them by the company, are truly immense. Being in its peak shape, the market is evolving at a very fast pace, which means that Personal Concierge and its members will have to keep the pace.
Competition
Because of the comparative novelty of the services, there has been no corporate monster that could engulf the entire market and attract all potential customers. While one must admit that some organizations have been experiencing a remarkably big success, while others were soon left forgotten, the chances for new entries to attract the target audience are quite big.
Trends
As stressed above, the focus on options that digital technologies provide to companies operating in the target market can be viewed as the primary trend to pay close attention to. With the technological breakthrough that has been witnessed since the 20th century, the tendency for the personal concierge industry to blend with the realm of information technology should not be viewed as something entirely unexpected. Quite on the contrary, for Personal Concierge to become recognizable and popular in the target market, the incorporation of IT tools is indispensable.
In fact, when considering the digital market as the possible environment that the organization may explore, one should keep in mind that it is also extremely profitable. According to the recent estimations of the target market, the 2014 impressive market revenue of $300 billion is about to triple in 2017 to reach $850 billion (Djenee – Your personal digital concierge 2016). Thus, the possibility of merging with an IT organization that will help update the services and keep the quality standards high, as well as a focus on the active investment in the R&D processes, should be kept in mind.
Profitability
Seeing that the target market – or, to be more accurate, two markets, including the traditional and the digital ones – are in the stage of growth, it can be assumed that entrepreneurship is going to be rather profitable. As the Five Forces Analysis provided below shows, there are impressive chances for Personal Concierge to become successful in the target environment.
Table 1. Porter’s Five Forces Analysis: Personal Concierge industry.
At present, it is very easy for companies to enter the environment of the personal concierge industry since there are very few limitations. Thus, the competition rates are very high in the identified market, with every new entrant attempting at becoming the grand organization at the helm of the industry. The bargaining power of suppliers can be placed somewhere in the middle since the current quality standards allow practically anyone with basic management skills to become a candidate for the position, yet there are very few job opportunities for the position of a personal concierge at present.
Therefore, the overall prognosis for the company that is going to become part and parcel of the personal concierge market is comparatively positive. It should be noted, though, that the target realm conceals a plethora of challenges, such as the choice of the tools for promoting the services.
Distribution Channels
When considering the means of delivering the personal concierge services to the end customer, one should consider the use of websites. Using the identified tool as the means of making an order or learning more about the opportunities that one may enjoy with the help of the company, one will be able to retain maximum flexibility.
It could be argued that the services of another organization, such as travel agencies used by hotels, could be viewed as possible distribution channels. However, a closer look at the personal concierge service will reveal that there are very few companies that could link the end customer to the firm offering the services of a personal concierge. Therefore, websites can be deemed as an essential distribution channel when it comes to mobile apps and similar devices. However, as far as the physical services of a personal concierge are concerned, the use of a direct channel of distribution should be advised.
The reasons for using a direct distribution channel concern not only the lack of companies that could help connect the target organization and its customers. While there are, indeed, very few organizations that can help connect the identified company with its potential clients, there is also the impediment that is linked directly to the nature of the services. As stressed above, although the web application is viewed as one of the most promising brand products, the focus will remain on the use of the services of a personal concierge.
Cost Structure
When considering the cost structure of the organization, one must bear in mind that the focus on the R&D aspect of the firm’s operations is likely to be the most expensive project. Therefore, it will be necessary to invest extensively in both the R&D and the IT departments of the organization so that the staff members could deliver positive performance and that both the design of the new app and the overall information management should be carried out in a manner as successful as possible. As the summary of the company’s fixed and variable costs shows, there is a threat that the expenses may turn out to be more numerous than the financial assets of the organization.
Figure 1. Cost Structure (2017–2021): Fixed Costs ($1,000).
Figure 2. Cost Structure (2017–2022): Variable Costs ($1,000).
In order to address the issue of expenses and introduce and efficient cost management strategy, one should consider the principle of sustainability. Particularly, it is suggested that the available financial resources should be distributed across the departments of the organization in accordance with its current priorities. As explained above, the R&D department, as well as the IT services, will require the greatest amount of resources for the next few months. Afterward, a substantial amount of finances will have to be used to brand the services and create an impressive promotion campaign.
It should be noted, though, that, given the specifics of the company’s focus, the identification of costs may become a problem. Since the organization will provide not products but services to its target audience (i.e., the ones of a personal concierge), the calculation of costs per unit becomes rather complicated. It is expected that the identified expenses will be estimated on a case-by-case basis.
Success Factors
When considering the circumstances that are likely to be very favorable for the organization, one must mention that the tourism and hospitality industry, to which the services of a personal concierge are often related, is thriving in Dubai. Seeing that the city is known as not only a tourist attraction but also a business center with a range of companies operating in its economic environment, the possibility that the services of a personal concierge as a person that runs any errands are likely to be very popular.
The fact that the industry is quite new and, therefore, does not have dominant organizations in it yet should also be viewed as an essential success factor that is likely to shape the performance of the organization to a considerable degree. With fewer rivals and copycats, Personal Concierge will be able to climb to the top of the market/.
Sales and Revenue
It is expected that most of the company’s revenues will come from sales. Particularly, the provision of personal concierge services will be viewed as the primary source of revenue. Since there are very few similar organizations in the environment of the Dubai market, there is a possibility that Personal Concierge will become a monopoly that will control the identified economic environment. Therefore, the choice of the pricing strategy will depend solely on the decisions made by the organization. At this point, however, one must address the issue of corporate integrity and honesty in economic relationships. In other words, Personal Concierge must not abuse its powers and set the prices that are excessively high. Instead, a sensible framework that incorporates a compromise between the needs of customers and those of the organization must be made. Thus, the buyers will develop loyalty to the organization and will be inclined to purchase its products in the future.
Financial Plan
Organization
Leadership Strategy
When considering the possible choices for the leadership strategy, one must admit that efficient leaders must not restrict themselves to a single approach. Quite on the opposite, a situational strategy must be used so that both the staff and the managers could enjoy an impressive amount of flexibility in their decision-making processes. In order to improve the performance rates of the staff, one must give the employees credit for understanding the internal processes, particularly, the ones that belong to their area of competence. Therefore, it is strongly suggested that a combination of different leadership approaches should be used in the workplace.
Seeing that the provision of services that require a face-to-face communication between the personnel and the customers is going to be predominant in the company, it is desirable that the use of the charismatic leadership strategy should be considered as one of the main frameworks. By incorporating the specified approach into the framework, one is likely to promote specific behaviors that will attract the target audience to the company and convince them to use the offered services.
Furthermore, the transactional leadership approach should be viewed as the next most important tool in managing the employees’ performance. The identified framework can be viewed as a possible choice once the staff members recognize the value and needs of the organization and are inclined to follow them. As a rule, the transactional approach implies extensive coaching, which is why it will be necessary to adopt it at a comparatively early stage of the company’s evolution so that the employees could receive the necessary training.
Last but definitely not least, the transformational approach must be viewed as an essential leadership strategy. Although it is typically viewed as the means of implementing change in the workplace and, therefore, it does not have to be used regularly, it will be an essential part of the management process once the necessity for a rapid and efficient change emerges. On a more profound level, the application of the transformational leadership framework is bound to help alter the professional abhors of the staff, changing not only the organizational behavior but also their values. As a result, it is expected that the personal concierges to be employed in the organization will follow the corporate ethical code closely. Thus, a rapid increase in customer satisfaction and, therefore, customer loyalty rates, is expected.
Information Management
Another essential part of corporate management, the introduction of an efficient data management strategy must be planned carefully. As far as data retrieval, distribution, and processing within the environment of the company are concerned, the principles of information sharing must be promoted to all company members. The identified objective might turn out to be rather tricky since the staff members might be unwilling to share their experience and information with each other out of fear of being surpassed and losing their status in the organization. While being admittedly understandable, the identified attitude should not be encouraged.
To avoid the issue, it will be necessary to focus on the needs of each staff member individually, thus, making it clear that they are valued as individuals and that the organization is ready to invest in their progress as professionals. Thus, the principles of information sharing can be established in the context of Personal Concierge.
The issue of data security and the outside factors that may possibly impact it need to be mentioned as well. To manage the loopholes in the current approach toward data security, an upgrade of the IT tools used currently for the purposes of data protection must be carried out. Furthermore, it will be crucial to make sure that the employees receive training about the proper use of data security tools. Finally, the platform that allows arranging the information retrieved from the company’s customers and integrating it so that an approach for managing the customers’ requests.
Risk Management
When considering the tools available for the assessment of the existing risks, the company should use a combination of the devices that will help it manage the current risks and at the same time make forecasts regarding the possible development of the organization and the changes in the target environment. For these purposes, the application of a cause-and-effect diagram combined with the modeling and simulation should be viewed as a necessity.
While the former provides retrospect on the changes that the organization has experienced, thus highlighting the points at which the problems must have occurred, the latter can be viewed as the tool for understanding the nature of the risk and detecting the areas that it is likely to affect to the greatest extent. Risk audits, in their turn, will be used as the means of locating the framework that will help manage the future challenges and address the risks to which the company will be exposed in the target environment.
Strategy and Implementation Summary
It is imperative that the risks faced by the organization should be managed based on their priority and urgency. Furthermore, the prevention of risks is linked directly to the timely analysis of the essential data and its further application to the design of an adequate response. Therefore, the improvement of the information management tools, including the promotion of better communication and negotiation techniques, as well as the introduction of new and enhanced tools for data acquisition, processing, and transfer, must be viewed as an essential step toward implementing the risk management approach.
Exit Strategies
Although it is highly unlikely that Personal Concierge will suffer a defeat in the environment of the Dubai economy, there is a possibility that the company will have to exit the market under the pressure of unforeseen circumstances. Therefore, it is crucial that the appropriate exit approach should be chosen before the organization enters the competitive environment of the Dubai market.
A Merger and Acquisition
The use of a merger and acquisition as a means of maintaining a presence in the target market and at the same time retaining some of the financial assets is rather sensible. Used quite commonly, the approach implies that Personal Concierge should team up with another organization that provides similar services in the context of the Dubai market. When considering the possible choice for a merger, one should take a closer look at the IT organizations dominating the Dubai market. As explained above, there is a propensity toward incorporating e-tools into the set of services provided by personal-concierge-related companies (e.g., a mobile application for reminding about the essential information, scheduling the appointments and events, etc.).
A Cash Cow for the Next Profitable Idea
Introducing a new idea is the potential cash cow for the business can also be considered a possible exit strategy that Personal Concierge may apply in the context of the Dubai market. In this case, the emphasis must be placed on the development of a web application that will provide customers with extensive opportunities of tracking the completion of the essential tasks by the concierge, tracking down the stage at which the task currently is, and evaluate the performance of the assistant with the help of a survey. Furthermore, the design of the application may also involve extra options for contacting the company directly. It is presumed that the option of providing personal feedback will help the organization understand the needs of the target audiences better.
Reference List
Djenee – Your personal digital concierge. 2016. Web.
Ibis World 2015, Business concierge services in the US: market research report. Web.
Innomen, A & Saaksvuori, A 2013, Product lifecycle management, Springer, New York, NY.
Lee, M, Adulbek, U, & Nam, H 2016, ‘A study on the participation in leisure activities of migrant workers in Korea’, Advanced Science and Technology Letters, vol. 127, pp. 154-159. Web.
Toedt, M 2013, Big data – challenges for the hospitality industry, 2nd edn, Epubl, Berlin.
‘Waldorf Astoria set to open in the Middle East’s leading financial district’, Aviamost. Web.
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