There were several instances when group members had different views regarding various decisions, during our group discussion. Divergent opinions by members did not stop the group from finishing its objectives. Opinions which were supported by the majority in the group were adopted as collective decisions. Group members did not antagonize each other and they ensured that all decisions were made through consensus.
Improvements in Production
The first decision which members had to deliberate on was the issue of operations and production. Some members favored improvements in the firms internal operations to boost the quality of products released into the market. All members agreed that the firm needed to institute operational excellence to make it firm more competitive in the market.
However, some members felt the best way to institute operational excellence was by improving quality standards in production. However, some members had different opinions regarding this issue. They felt that cordial relations between the firms employees and its clients would improve its reputation in the market, thereby making existing clients loyal.
Later, everyo member agreed that good customer relations together with improved quality standards will enable the firm attain operational excellence. Some members felt that the firms research and development function needed to be improved.
They argued that a strong research and development department will make the firm have a competitive edge in the market. This is because, the firm will be able to innovate internal processes to improve the quality of its products. Some members felt that all departments need internal quality systems.
Relationship with Suppliers
In the third decision members had to decide the best way to engage with suppliers. Some members felt that an exclusive contract with suppliers was beneficial for the firm. Other members thought that an exclusive contract would limit the firms options in case a supplier failed to bring crucial merchandise for production. Many members agreed that the firm needs a flexible contract to enable sourcing of products from other suppliers if a supplier fails to deliver merchandise in time.
This would ensure that crucial processes in the organization are not jeopardized if a supplier fails to commit to terms outlined in the agreement. This approach will help the firm to reduce risks related to failure by suppliers to deliver merchandise on time. This will also ensure that crucial production processes in the firm are not interrupted. Some members felt that the firm needs to improve its technical systems to make its operations more efficient.
Internal Technical Functions
Many members argued that crucial technical functions in the firm need to be outsourced to external technicians. However, some members felt that it was necessary to hire new technicians to replace the current team of technicians who are less skilled. Afterwards, all members agreed that current technicians need additional training to make them more competent. Members agreed that this approach would be beneficial to the firm in the long term.
The time allocated to the R&D team caused some differences in opinion. Some members felt that the R&D team needs to be given 15% of normal working hours to work on their own projects. However, some members felt that 10% of normal working hours would be enough for the R&D team. Many members agreed that if the R&D team was given 15% of normal hours, it would be more creative. All members felt that the firm needs to give a 10% discount to customers to make them more loyal.
There are several challenges in doing international business. The first challenge in international business is to how to navigate the stalled global economy (Griffin 60). Todays business manager is equally faced with the challenge of attracting and retaining the right personnel.
There is also the challenge of changing information technology (IT) and how to harness IT into the overall organizational strategy. This is coupled with a further challenge of managing and measuring organizational performance (Gareth and George 407-415). Globalization is yet another challenge faced by modern day managers.
Todays manager faces the challenge of procurement and managing supply chain networks in the international business. Managing diverse cultures (Griffin 176) coupled with ethics and social responsibility is the other challenges. The other problem is labor shortages, market management and business financing.
Businesses also face the challenge of the right mergers and acquisitions as they seek to grow (Griffin 256). Other leadership challenges include developing effective work teams, motivating employees, managing employee attitudes, managing innovation, employee privacy, and meeting stakeholder objectives.
Lessons Learned
A company might want to go global in order to survive and grow (Gareth and George 1-548). The company may want to diversify its product offering, maximize sales or to acquire more resources. In spite of the above opportunities, going global has its share of challenges. Since the world economy has seen a downward trend, there has been a slow growth of international businesses (Griffin 60). This implies that businesses that are seeking to go international are likely to take long before they can stabilize in their international operations.
Technology keeps changing every day. The business must be able to embrace technology and harness it into the overall organizational strategy. The business needs to be able to effectively evaluate its performance (Gareth and George 1-548). The international business is characterized with diverse cultural differences. The business must be prepared to deal with diverse cultures and different value systems in international business (Griffin 176).
Today, businesses have a duty to conserve the environment and to give back to the society (Gareth and George 1-548). Todays manager is aware of corporate social investment and is seeking to include it in the overall governance of the whole business (Griffin 117). Customer expectations, tastes and preferences keep changing every day. Hence, the business must make an attempt to cope up with these lest they lose the customer. The business must therefore determine how it will implement its marketing initiatives.
In todays competitive world, the business must find the right methods and approaches to procurement and manage its supply chain networks. Human resource experts must plan and avert the problem of labor shortages through successful human resources planning (Gareth and George 1-548).
The business must implement effective marketing strategies and adopt the right financing methods in order to be competitive. The manager must equally be prepared to enhance teamwork and motivation to increase productivity. The business must embrace technology in enhancing its efficiency (Griffin 718).
Culture is the habit, language and norms usually passed on to new employees as they join the organization. Culture influences the way employees interact with one another as well as with the customers, suppliers and other organizational stakeholders (Gareth and George 1-548).
The business must hence be prepared to deal with different cultures and values in the international area. Values uniquely define the business and give it a competitive edge. Culture includes things like integrity, customer focus, and results. To change organizational culture, there is need for effective leadership because leaders inculcate and reinforce the organizational culture and belief systems amongst the employees (Griffin 176).
Teamwork fosters faster learning and helps in task allocation. Through teamwork, employees are able to bond and develop long lasting relationships. Gareth and George (1-548) have indicated that teamwork creates a healthy competitive environment. This brings out the inner talents and creativity hence more productivity of the employees. When working in teams, employees are more satisfied in their jobs and able to accomplish their tasks efficiently. The business must this strive to develop highly effective work groups and teams.
Managerial Implications
Going global is a challenging venture to the business because of several factors such as culture. Organizational culture defines the behavior patterns and actions of employees (Griffin 176). There is need to develop and nurture a positive culture that will act as a strong brand and a source of competitive advantage to the business (Gareth and George 1-548).
Since technology improves business performance, the business must invest in appropriate technology to remain competitive. The business must conserve the environment (Griffin 120), use right approaches to procurement and manage its supply chain networks.
The business must equally conduct an effective HR planning, implement successful marketing strategies and adopt the right financing methods. Finally, the business must develop effective teams. When employees work in teams, they become more fulfilled in their roles. They are able to meet their individual and collective responsibilities. Consequently, the business becomes more productive.
Works Cited
Gareth R. Jones., and George, Jennifer, M. Contemporary Management 7th Edition.
Risk management elements are risk assessment and risk mitigation. Risk assessment allows the business management team to evaluate the likely risks as well as the sources of those risks before venturing into a new market. Thus, this reflective treatise attempts to explicitly review the risks that Mogan Industrial Company will face in the German market and possible mitigations for the identified risks.
German Market Risks
Risks are uncertain happenings which have impact on projects being undertaken. As a result, risk analysis is deployed to assess the degree of risk uncertainty as well as its impact on a project. One of the major approaches applied in project risk analysis is structural risk analysis, which is used to determine some of the problems related to technical implementation. Operational risk is regarded as the main risk in this line of the companys business.
Structural risks
Introduction of the company in the German market may face challenge of market penetration since the construction industry of Germany is known to operate in a very competitive market. The major competitors that the company will have to deal with include government agencies and well established businesses. Besides, the laws and regulations of running business in Germany are very strict and may be unfavorable to the company.
Operational and Economic Risks
Operational risks involve risks associated with processes, people, and technological elements. The essential political requirements of MICUS towards the entry planning and development phases are those that impact directly on the stability of the German culture.
Notwithstanding, this diversification of the economy has led to the definition of the inter dependence of sectoral components of the economy that translate to the realization of a restricted business operation. As a matter of fact, the cost of running business in Germany is higher than that in America due to taxes (German Construction Industry 2012). This summarized in the table below.
Risk
Impact
Probability
Economic and Financial Risk
High
Operation of business in Germany is very expensive due to the high taxes.
Low
Since the company is reliable, there is an assumption that the company will benefit from economies of scale to reduce the cost of doing business in Germany.
Operational and Technological Risk
High
The overruns on cost are likely to create a ripple effect in other company implementation categories such as hiring suitable personnel, marketing, and competition.
Medium
Since the company is tightly controlled, the probability will not be high since the company has a strong establishment in America besides planning to adopt the acquisition strategy to enter the German market.
From the above classification table, probability/impact matrix was developed as indicated in the table below.
Probability
Low
Medium
High
High
Political Risk. Economic and Financial Risk
Delay Risk, Safety Risk, Operational Risk
Social Risk
Medium
Low
Environmental Risk, Legal Risk
Impact (Source: Self generated)
Explanation of the Project Probability/Impact Matrix
BLUE
The risks here are classified as occurred and the ideal approach would be avoidance of the risks such as cultural conflict in business.
GREEN
The ideal approach would be either risk transfer or mitigation with those in the LP-HI addressed through contingency budgeting. The MP-MI category should be addressed through a critical contingency plan.
ORANGE
The risks in these categories should be addressed through simple risk acceptance and dealt with through risk managements approaches as they arise.
Risk Management Strategies
Foresight is very crucial since it gives a company rough perspective and overview of the future concerning the expected and unexpected changes and challenges (Sai-Global 2012).
Therefore, MICUS should carefully examine and evaluate their past and endeavor to adopt relevant skills that will be relevant for future challenges and responsibilities in Germany. In the quest for internalization, MICUS Company should opt for local labor as a strategy and include members of the German company in the management team through training of young and talented managers.
Besides, the company should embrace the need for creation of an integrated structure to absorb company goals and those that favor business in Germany. In turn, this will give the company various meanings with relation to it prospective or viewpoints as German citizens have unique culture (Hull 2011). Besides, this foresight gave the company ability to look forward into the future in an effort to predict and anticipate various developments before they actually take place since some members of the decision making organ will be Germans.
The company should embrace the unique culture of the Germans who are their consumers. In doing this, the company should incorporate distribution agency control by the Germans and customized the products to suit consumers. In effect, the prevailing trends determine an organizations functions and the context within which it operates (Timans 2006).
Therefore this strategy is very crucial, especially in forecast of future direction as the German, market will be used to customization and introduction of special aspects in the engineering industry. Apparently, the company is in a good position to venture in the German market as indicated in the risk analysis.
References
German Construction Industry. (2012). Construction in Germany: Structural Data on Production and Employment Facts and Figures for 2011. Web.
Hull, J. (2011). Fundamentals of Futures and Options Markets. New Jersey: Pearson.
Introduction: Skechers Shape Up and its Current Rates
Promoting sportswear is not an easy task; even though sport has become an integral part of many people, a great chunk of the population still considers sport as something to be taken professionally. Therefore, promoting sportswear is quite a complicated task; however, with a careful marketing plan that involves the analysis of the related factors, one can possibly come up with a marketing solution for such a brand as Skechers Shape Up (Skechers, 2012).
Customers Age and the Existing Marketing Opportunities
When considering the target audience among which Shape Up is bound to enjoy the highest popularity, one should sort the potential customers according to their age. The given solution seems most reasonable, since it would be reasonable to suggest that the younger people are, the more actively they take up sports. However, according to the existing evidence, sport has recently become more popular among people over 50, which is also to be remembered for developing a marketing campaign.
Age and the Related Issues: The Appropriate Ways of Shaping up
Even though age is of great importance for making the list of possible customers, it should be also mentioned that personal characteristics also play great role in shaping peoples attitude towards sport and sportswear. When defining the best ways to promote such sportswear as Shape Up to different target audience, not only age, but also possible social and personal issues must be recognized.
Lifestyle traits and the customers age: it is hard to keep fit
When splitting the customers into age groups, one might consider lifestyle traits as a noteworthy issue. While some people may be inactive by the time when they reach their thirties because of their lifestyle, others, who prefer more active way of life, remain physically active till they are in their late 60ies (Finch, 1997).
Shaping up and demographics: sports and the city
Demographics is another important issue to consider. As for the chosen city, its population rates are rather low (21,177 people). Studies show that in the areas with low density of population, people are more apt to taking up sports (Arditti, 2012). Therefore, the age statistics should be related to the demographics when promoting Shade Up.
Concerning the specifics of personality
The last, but definitely not the least, personality plays a great role in peoples attitude towards sports. Unfortunately, it seems hardly possible to find a way to split the customers into groups according to their personality types. However, it is possible to adapt the future marketing strategy to suit all four personality types. For example, it will be a good idea to come up with four different legends behind the brad for four different personality types (melancholic, choleric, sanguine and phlegmatic ones).
Conclusion: There Is Still a Long Way to Go
Therefore, it is clear that, to promote Skechers Shape Up in the given area, it is necessary to take careful account of the customers age in the first place. The classification, however, should not be restricted to splitting the customers into age groups solely it is also necessary to take account of such important factors as health state, occupation and interests. Once the Skechers learn to incorporate all these factors into their marketing strategy, Shape Up will become a highly popular and recognizable brand.
Reference List
Arditti, D. (2012). Dr. Natural Causes Patel struck off. Web.
Finch, H. (1997). Physical activity at our age. Web.
The government of Saudi Arabia adopted a new labor in 2012 that compels companies in the private sector to employ more Saudis than foreigners. The government adopted the new law in order to reduce the high unemployment rate in the country. However, the law is expected to have significant effects in various industries in the country because most companies depend on the labor supplied by foreigners rather than Saudis (Hamdan).
This paper will analyze the effect of this law on Jarir Bookstore, which is a leading retail company in Saudi Arabia. The company supplies computers, office equipment, and books among other products (Jarir). In particular, it will shed light on the risks associated with the legislation and the strategies that the company has adopted to overcome them. Additionally, it will highlight the future implications of the new law to the company and its stakeholders.
The Major Issues
In November 2012, the government of Saudi Arabia enacted a new labor law that forces all private companies in the country to hire more Saudis than foreigners (Hamdan). This law was adopted against the backdrop of rising unemployment rate in the country. According to the new law, the number of Saudis working in private companies must exceed that of foreigners. Companies that fail to comply with this law are expected to pay a fine of approximately $640 annually for each employee from a foreign country (Hamdan).
Jarir Bookstore is one the companies that were negatively affected by the new labor law. In 2012, the company had more than one thousand employees who were working in its stores in Saudi Arabia (Jarir). 60% of the employees were expats from Asian countries (Jarir).
This means that the company had to pay the fine of $640 per foreign employee in order to maintain 60% of its workforce. In this regard, the operating cost of the company was likely to increase because it was not ready to absorb the extra labor costs associated with the fine.
Since its inception in 1979, Jarir Bookstore has focused on employing foreigners in order to reduce its operating costs. This strategy was based on the fact that expats demand lower wages than Saudis (Madhi and Barrientos 70-77). Thus, it is cheaper to employ foreigners than Saudis. In addition, most Saudis are reluctant to work in the private sector because the public sector pays higher wages.
Since the company operates in cosmopolitan cities within Saudi Arabia, it prefers to employ people with good command of English and other international languages in order to serve its diverse clientele effectively. In this regard, the company hires multilingual foreigners since most Saudis speak only in Arabic rather than international languages such as English. Thus, replacing the expats was likely to have negative effects on the competitiveness of the company.
Resolution
Even though the enactment of the law came as a surprise to the company, it had no choice but to comply with it in order to avoid the costs associated with the fine. In order to prevent disruptions in its operations, the company had to replace most of the expats in its workforce immediately. Almost 80% of the companys workforce consists of frontline employees who are responsible for performing duties such as sales and fulfilling customers orders (Jarir).
Even though most Saudis are qualified to perform clerical and supervision, as well as, sales and marketing related duties, the company had trouble in replacing its frontline employees. This is because most of the new hires did not have the commitment that the expats had. Besides, most of them were fresh graduates from colleges and universities. Thus, they did not have adequate work experience that would enable them to fit into the organization without training.
In response to this challenge, the company had to review its staffing policies in order to hire the right people. In particular, the company had to identify the job requirements that new recruits had to meet in order to be hired. This included possession of excellent skills in areas such as communication, negotiation, and leadership (Jarir).
Moreover, the company designed and implemented training and development programs in order to enable the new recruits to acquire the skills that they needed in order to perform their duties effectively. The company has had to change its human resource policies in order to attract and retain the best talent from Saudi. This involved offering attractive remuneration packages, flexible shift schedules, and acceptable work environment.
In addition, the company implemented a performance-based pay system in order to motivate the employees and to improve their productivity (Jarir). A performance-based pay system involves rewarding employees who are able to meet or exceed their targets (Martin 75). At Jarir Bookstore, the employees were paid annual bonuses if they achieved predetermined conditions such as sales targets.
The Future Implications
The new labor law has several future implications for the company and its stakeholders. To begin with, the company will have to look for alternative ways of reducing its operating costs. This is because it can no longer depend on cheap labor to maintain low costs. In this regard, the company is likely to focus on the use of modern technologies to reduce its operating costs in the long-term.
This will involve the use of technologies that reduce human involvement in the provision of its services. For example, the company has already established a sales and marketing website that enables it to reach its customers (Jarir). Thus, the company is likely to focus on online sales rather than the store model in future. This will help it to reduce the number of employees that it needs to serve its customers, thereby reducing its operating costs.
The second implication is that the company will have to strengthen its employ retention programs in order to reduce labor turnover. This is because the competition for skilled labor is likely to increase as more companies comply with the new law in future. Labor turnover is often high in markets where companies are competing for the few skilled workers. This is because employees will prefer to work for the few companies that are able to offer high wages (Hartel and Fujimoto 96).
Consequently, the cost of acquiring talent is likely to increase significantly. The company can avoid losing its valuable employees by improving their commitment and job satisfaction. The third implication is that the morale of the employees is likely to reduce as the expats leave the company. Employees usually lose morale in their work when a large number of their colleagues leave the workplace.
This is because existing work relationships are destroyed and the remaining employees might not have adequate sources of support in their work (Hartel and Fujimoto 112). In addition, conflicts are likely to arise if the company is not able to integrate the new hires with the remaining employees. In this regard, the company will have to implement team-building initiatives in order to improve cohesion among its employees.
Finally, the new law will enable the company to improve its reputation in the country by providing jobs to Saudis. Currently, the company has a bad reputation in the country because its staffing policies favor foreigners. However, the companys reputation is likely to improve as it begins to hire more Saudis as required by the law.
The Risks
The implementation of the new labor law was associated with the following risks. First, the company was likely to lose its investments in knowledge and skill development as it replaced its employees from foreign countries. The company had already spent its scarce resources to train the expats on areas such as customer service, sales, marketing, and management.
The benefits of this investment such as creativity among employees were likely to be lost if a large number of the expats left the company. This would reduce the firms competitiveness by limiting its ability to engage in product and process innovation (Madhi and Barrientos 70-77).
Second, the company was likely to face disruptions in its operations if it was not able to find skilled Saudis to replace the expatriates. This is because the process of replacing employees who leave the company often takes a lot of time. Third, the companys operating costs were likely to rise because hiring Saudis would increase the labor costs, whereas employing foreigners would attract high fines. High operating costs was likely to reduce the companys profits, thereby limiting its ability to expand to other markets.
The strategies that have helped the company to overcome these risks include the following. First, company has implemented training and development programs in order to replace the lost skills and knowledge in its workforce (Jarir). These programs will enable the firm to improve the competence of new hires, thereby increasing its competitiveness in terms of ability to meet market needs.
Second, the company has focused on reducing labor turnover in order to avoid losing its talented employees. This involves using intrinsic rewards such as promotions, as well as, extrinsic rewards such as bonuses to improve job satisfaction, motivation, and employees commitment. Finally, the company has embarked on cost cutting measures in order to absorb the high cost of hiring Saudis. This involves outsourcing processes such as transportation and logistics.
Conclusion
The aim of this paper was to analyze the effects of Saudi Arabias new labor law on Jarir Bookstore. The new law requires private companies to employ more Saudis than foreigners. Jarir Bookstore focused on employing more foreigners than Saudis in order to reduce its labor costs.
The main effects of the law included increased operating costs and loss of skilled employees. However, the company is also likely to improve its reputation in the country by employing Saudis. The company has not only complied with the new law, but has also implemented strategies to cope with its negative effects. The strategies it has adopted include staff training programs, cost cutting measures, and staff retention schemes.
Works Cited
Hamdan, Sara. Saudi Arabia to Fine Firms with too Many Foreign Workers. New York Times, 21 Nov. 2012. Web.
Hartel, Charmaine and Yuka Fujimoto. Human Resource Management. New York: McGraw-Hill, 2010. Print.
Jarir. Company Profile. Jarir Bookstore, 31 Dec. 2012. Web.
Madhi, Salah and Armando Barrientos. Saudisation and Employment in Saudi Arabia. Career Development International 8.2 (2012): 70-77. Print.
Martin, John. Human Resource Management. New York: McGraw-Hill, 2008. Print.
The focus of this essay is a business enterprise that would be involved in selling glasses and pitchers. The products can be used for various purposes among them putting beer, juice and water. Most people think that bars only sell beer but there are juice bars. A juice bar is a place where people who do not take beer can go and take different types of juices. One of the advantages of the products is that they are able to keep liquids cold for about one hour.
Location
The location of a business is important since it determines its growth. This implies that before starting any business enterprise, it is important to identify a suitable location that guarantees satisfactory business growth (10 reasons to start a business, 2013). Our business would be located in the City of Vancouver. There are other locations where the business could have been established, but the City of Vancouver is the most suitable among them. The City of Vancouver attracts many tourists because of its good hotels and attractive sites.
In addition, tourists are always ready to use a lot of money and this would increase our profits. Apart from tourists, the residents of the City of Vancouver would find the product beneficial. The city is characterized by many bars and restaurants which need a high number of glasses and pitchers. In addition, the local residents like healthy drinks and milk. This implies that our products would fit well with the needs of the local residents because of their high consumption rate of fluids.
The business would be given time to stabilize within the first year before expanding it to other places outside the city of Vancouver. We would first carry out a market research to identify the most suitable locations where other outlets would be established. In the third year, we would spread the business to British Columbia because this would be a viable region where it would thrive well and grow fast.
Market Analysis
The first thing in our market analysis would be our target customers. In this regard, we would first apply business to business strategy. Business to business strategy means that we would walk into local stores such as bars, restaurants and juice points where we would do presentations on our products.
This would popularize our business enterprise and provide local traders with adequate information about our products. In addition, we would offer free samples such as table mats with adverts about our products for the customers to get information about the products. Our second strategy would be business to customer strategy (Rodgers, 2001). In this strategy, we would make use of online platforms to reach customers directly. We would advertise through Facebook, YouTube and other online platforms.
The second item in our market analysis would be the image and special features of the products. It would be important to create a good image of our products by enlightening customers about the special features of the products. We would inform our customers about the plastic products that would be selling at reduced prices. One of the products we would offer our customers is tritan plastic which is used to make glass.
Tritan plastic has many advantages over other products. To begin with, it has the ability to keep fluids cold for about one hour. It is also clear, a quality that makes it possible for the user to see what is inside the glass (Moore, 2008). Tritan plastic is lighter than glass and this makes it convenient to use. In addition, when tritan plastic is compared with polycarbonate, it is easier to transform into various articles with minimal energy and waste.
Apart from plastic products, we would also provide brosilicate which is used in the manufacture of glass products. Brosilicate glass has numerous advantages over other glass products. The first advantage of brosilicate glass is that it has the ability to tolerate extreme heat and cold. The second advantage is that it has a low level of thermal expansion. When compared with shattered glass, brosilicate glass is easy to clean in case it breaks. Finally, it is not easily affected by chemical corrosion.
Marketing
Marketing would be an important activity for our business enterprise because it would inform potential customers about our products. The first marketing strategy would be visiting local businesses such as bars, restaurants and juice points to do presentations in order to popularize our products.
We would also include free samples like table mats with our products in our marketing strategy. The other marketing strategy that we would use is online marketing through Facebook, YouTube and other social sites in order to reach our potential customers. Our initial marketing would start at the City of Vancouver but after the first year, we would move to other places outside the city. The first location outside the City of Vancouver would be British Columbia since it would be a viable market for our products.
In order to reduce costs and shorten the marketing chain, we would apply direct sales. This implies that we would not hire any middlemen since the four members of our business enterprise would be enough to do the work. Our selling strategy would comprise of at least six or eight glasses plus a pitcher. The same strategy would be applied in our online marketing.
Sales Strategy
Our sales strategy would be customer oriented selling approach which would start by establishing rapport with the customer. After a rapport has been established, the second step would be to determine situational factors and objectives of the customer. The third step would involve urging the customer to take an action because his objectives would be met by the product.
The last step in our sales strategy would be to obtain a commitment from the customer. The strategy would also emphasize customer advantage for him/her to see the importance of purchasing the product (Ranchhod, 2007). The competitive advantage for the customer must be read because failure to read it does not benefit customers. It should also be specific because this translates into a benefit for the customer. Competitive advantage is also supposed to be appealing in order to promote it to the customers.
Management
Our management team would be comprised of a marketing manager, a website manager, an operations manager and a financial manager. The marketing manager would explore available external opportunities, design marketing strategies, handle customer relations, ensure timely product delivery, manage budgets and come up with new marketing guidelines.
The roles of the website manager would include monitoring online marketing strategies, ensuring proper functioning of our website, posting important information on the website and communicating with customers online. The operations manager would supervise all activities of the organization, manage projects, work with customers and serve the role of a resource person in our business enterprise.
Finally, our business enterprise would require the services of a financial manager, who would raise funds for the business, allocate funds for different tasks, plan on how to spend profits and provide insights on capital markets (Role of a Financial Manager, 2013). The duties of the different managers would be clearly defined hence there would be no conflict of interest or misunderstandings.
The rapid changes in technology have affected the way businesses and organizations operate. Fields such as nanotechnology, computing, communication, biotechnology and genetic engineering are the most affected. There is a lot of competition due to advances in technology.
Therefore, managers have been compelled to adjust accordingly in order to cope with the prevailing challenges. In some cases, other businesses are forced to redesign the operations and business processes of their organizations. According to Glassman, Zell and Duron (2005), this gives them a competitive position to respond to the changes in environments that surround the organizations.
For this reason, there is dire need for managers to change the way knowledge and information is managed as well as to reinvent strategically in order to ensure a competitive edge in the long run. The technology that existed some years back is now obsolete and no longer functional. This implies that the advances that are being made in technology will continue to affect the operations of businesses even in the future.
For businesses to remain competitive, there are factors that need to be considered especially in the top management levels. These are innovation, competition in the market and the regulation of laws that govern such organizations. All these moves will go a long way in ensuring that businesses and the entire world are politically, socially and economically stable. In view of changing technologies in the market, it is obvious that there are winners and losers.
The difference is brought about by the way businesses respond to changes in technology. For instance, most organizations lack contingency plans to cater for such emergencies. When changes in technology are likely to shake the foundation of a business, it is advisable to allocate some funds that can cater for the changes. It is vital to noted that technology is not a cheap aspect to cater for since it has always been an expensive undertaking.
The research and design department should work tirelessly in the organizations to make sure that the management allocates enough funds for this purpose. When recruiting staff members, it is vital for managers to strike a balance between technology related expertise and employees who do not require training (Glassman, Zell & Duron, 2005).
Training in an organization should be emphasized so that the organizations staff members become conversant with the technology that runs the business. As the organization progresses with time, rules and regulations should be changed regularly. Moreover, managers should be innovative and reuse materials through recycling so that the costs of transformation are reduced to the most minimal level.
Other organizations that are in quest to satisfy the needs of technological change have centralized the use of technology. According to Aulet (2009), this has encouraged sharing of expensive tools and equipment that are placed in central offices to ensure that less resources are bought in the organization.
Use of networks has also assisted in making sure that the shared resources are well managed. The latter enables users to work from a remote location. For instance, the use of networks will help departments share resources such as printers and expensive servers. The network should be made as complex as possible for purpose of security. It should ensure that hackers and other criminals do not take advantage of vulnerabilities of the system.
Human behavior affects the manner in which businesses perform. The management should therefore make sound decisions on human resource so that human errors are reduced to the lowest possible levels. Human error is a major reason for failure in businesses. Shapiro (2013) explains that conflict management is prudent. Misundertandings and conflicts are common among staff members of any organization.
Resistance to change is also likely to occur among the employees. It is upon the managers to communicate change in the right way in order to reduce chances of conflicts related to resistance to change. Fair remuneration helps reduce cases of conflict between employees and the employer. Motivation should be encourages as well. This ensures that staff turnover is minimal and also reduces costs of recruitment and training of new members of staff.
Staff experience is treated as an asset. Fair punishment should be done for all members of staff without bias or discrimination. Businesses have changed from the traditional ways of strategy formulation. Strategies no longer fall under mission statements and goals. Todays technology has affected the way strategy formulation is addressed.
It is only those businesses that make short term strategies that have competitive edge in the global economy. The external and internal entities and stake holders of businesses have changed their processes thereby forcing the businesses to change toward the same direction.
Managers should ensure that any form of technology that is in place is as simple as possible. Less complicated technology is easy to manage and analyze. The analysis done goes long way in ensuring that forecasting is executed perfectly. During this process, all vulnerabilities and loopholes are closed and the business operates at low risks. There are several forces (both external and internal) that affect the operation of businesses.
Moreover, a business environment is considered to be turbulent when several aspects of organizational change occur at the same time. Managers have different views on the effects of these forces. When the analysis and consultations are done in the right manner, business managers will be at vantage positions to control the set strategies and turbulent times in the business.
It is necessary to understand the business aspects that are required for the success of a business. In most cases, the size of the business does not matter. In fact, the most crucial aspect is to address market sizing issues so that they do not cause problems. This is one of the many steps and precautions that are taken to avert failure in the business. This paper highlights a marketing problem that will adversely affect an organization if it is not addressed by the marketing department.
Large scale and small scale businesses have problems that can facilitate the failure of the business. This can affect the established businesses as well as new businesses in the market. One of the marketing problems that affect most businesses is poor market sizing. Proper market sizing facilitates good market plans and leads to the success of businesses (Moutinho & Chien, 2007).
Therefore, knowing the right market size cannot be ignored by entrepreneurs. Proper market sizing will also ensure that the right products are provided to consumers.
Recently, experts in market research have confirmed that our company has a problem in market sizing. The company cannot determine the right size of the market that should be addressed. Besides, the company does not have full information on the products that can be developed to address the needs of the market.
One of the causes of this problem has been determined to be from within the company. The marketing team does not have the required experience to address issues of market sizing. This has led to improper market size estimates (Ferrell & Hartline, 2011). This is misleading to the company because it has made it difficult for the company to address the market sizing challenges. Besides, this is shown by inadequate allocation of time for planning marketing activities.
The other aspects encompass the macro environment. Here, the company is not objective in relation to the products it provides to customers. Aspects of pessimism have contributed to the problems of market sizing. Sometimes the marketing department is not sure of the performance of the products of the company. Further, the company has had unrealistic forecasts. They are meant to attain or integrate optimism in business.
The solution to the problem of poor market sizing is to recruit experts to do research that relates to the size of the market. Besides, there is the need to have realistic forecast. Furthermore, adequate market research needs to be done to ensure that goals are achieved within the organization. Adequate time should also be allocated to the design and forecast of marketing activities.
Analysis of the current marketing environment
A SWOT analysis of the current market environment of our company shows many perspectives. One of the strength of the company is the availability of resources (Bohm, 2009).
Precisely, enough capital is available for all activities that encompass market sizing. For instance, there are funds to facilitate electronic and print media advertising. The other strength is the capability of the firm to do an updated research in marketing. There are adequate facilities regarding the same issue. Thus, they can solve the problem if used in an appropriate manner.
The trend in the environment involves recruiting qualified staff in the field of marketing. Experts are being sought to conduct marketing activities. Our company has a weakness when it comes to experts in the department of marketing. The current employees do not meet the requirements of the firm regarding market sizing.
Incompetency in designing a proper market size for the company has led to poor performance in the company (Wied & Ebers, 2007). Unlike our company, our competitors are doing well in terms of market sizing. This gives them a competitive advantage over our company.
The trends in most companies encompass research and development activities. In fact, most companies have established research and development departments to oversee activities that can benefit the company. The environment provides the company with an opportunity to do research and address the requirements of the customers.
There are also investors and other stakeholders that are willing to invest in the company (Pahl & Richter, 2009). Thus, this is an area that needs to be exploited. For instance, the company can seek the help of investors to enable it to acquire experts to work in the marketing department. This is likely to address the problem of poor market sizing.
Equally, there are threats in the environment. Our company faces many threats from other competitors. Research indicates that most of our competitors have been in the market for long. Thus, they have sufficient and effective ways of conducting marketing activities. Also, they have no problems regarding market sizing.
This is a threat to our company because, while others are efficiently doing their activities, we are struggling with the same issue. This can also be confirmed by the reaction of the stakeholders of the company. Whereas other stakeholders are contented with the performance of their companies, our stakeholders are constantly complaining.
References
Bohm, A. (2009). The SWOT Analysis. Munchen: GRIN Verlag.
Ferrell, O. C., & Hartline, M. D. (2011). Marketing strategy. Australia: South-Western Cengage Learning.
Moutinho, L. A. M., & Chien, C. S. (2007). Problems in Marketing. London: Sage Publications.
Pahl, N., & Richter, A. (2009). SWOT Analysis Idea, Methodology And A Practical Approach. Munchen: GRIN Verlag GmbH.
Wied, S., & Ebers, M. (2007). SWOT Analysis Robert Mondavi and the Wine Industry. Munchen: GRIN Verlag GmbH.
There are elaborate principles instituted for the purposes of ensuring attraction and retention of clients within fitness industry. This can be drawn from the nature of world-class modern facilities required. The issues surrounding retention and attraction of clients remain one of the most concerns within the industry. This has led to increase in competition amongst smaller companies within the industry hence making operations more complicated (Mintzberg et al., 2003).
External environmental factors within Town Sports Inc International
There is enough evidence to prove that unlike most other major competitors within the market, Town Sports focuses on building current credentials and reputation based on high quality service provision amongst high-end and low-end consumers. Some of the most important external factors affecting Town Sports include location and accessibility. Most consumers choose their venue for fitness based on these two factors.
At the same time, financial and time commitment are necessary considerations as well as catering for those having tight work schedules and unable to commute to the companys fitness centers. At times customers feel demoralized when it comes to covering long distances for the purposes of reaching fitness centers. Other factors considered involved encouraging employees by offering corporate contracts at discounted within office premises (Town Sports International, 2012).
The nature of consumer demand within some areas has also contributed towards the growth of Town Sports Inc. This is since increase in demand signifies existence of potential target market and increase in physical health and fitness awareness. Composition of the target population in terms of age has also influenced the companys performance.
Town Sports basically serves youths and adults, with the majority age being between 15 to 50 years. Exposing this group of people to health consciousness through physical exercises makes them remain fit even in old age. The nature of services offered within the premises has also determined the percentage of attendance. This is since services are directed towards specific age range such as Yoga classes for seniors and appropriate classes for youths and teenagers (Mintzberg et al., 2003).
The company has considered cultural trends, through creation of national awareness campaigns concerning importance on physical fitness. There have been increased media campaigns as well as educational programs for the purposes of creating awareness. Cost of membership is reviewed frequently since it provides major stumbling block towards profitability within the industry. Various age groups are offered affordable prices according to their capabilities (Mintzberg et al., 2003).
Analysis of most important internal strengths and weaknesses
Strengths
Success of Town Sports Inc depends on its ability to offer credible corporate culture and ability to implement creative marketing principles. The kind of leadership within Town Sports focuses on providing consumers with new equipments at affordable costs.
Such kind of leadership strategies are considered integral in the process of establishing accepted culture within the corporate community. The management engages in much creativity, especially through introduction of technologically proven essential facilities. Such essential facilities provide customers with desired convenience and efficiency (Town Sports International, 2012).
Management focuses on discovering successful business aspects capable of withstanding any difficult times within the industry. This is not necessarily in contrast with other business enterprises since many practices within particular sectors are similar across the industry.
There are also other key points involving innovation and development of many unique business practices by the organizations management. In matters of differentiation, Town Sports Inc operates multiple clubs within populated regions making it easier for the company to serve targeted customer bases. The companys operation of close to one hundred and forty clubs equivalent to control of at least 2% of the market (Town Sports International, 2012).
Weakness
There is lack of customer loyalty to Town Sport brand which makes it loose considerable number of customers. Consumers are basically at freedom to choose fitness club of their choice since there are no dominant companies within the industry. Town spot fitness facilities are only concentrated to the east coast meaning that a large population within other regions are still deprived of their services.
Town Sport Inc applies the use of cost leadership method which usually focuses on meeting consumer demands through efficient services at affordable prices. There is focus on satisfying customers basic fitness needs and also minimization of costs by offering similar services in all centers. The company utilizes available extensive knowledge of the management team as well as innovative marketing strategies to capitalize on expansion (Town Sports International, 2012).
Town Sports Inc competitive position and possibilities
Based on Porters five forces, there is growing interest within the industry owing to low barriers to entry. This has made threat of new entrants to be high within the industry. At the same time there is low switching of costs based on the fact that, consumers choose preferred fitness centers based on accessibility and not brand name.
Lack of strict government regulations and also lack of dominant centers has led to increase in the number of new entrants. This ultimately explains existence of low barriers to entry with the only barrier being high nature of initial capital investment required for opening new facility (Barney, 2007).
Bargaining power of suppliers seems low since the industry requires contributions from few suppliers. The only distinguishing factor the company depends on its ability to offer new equipment based on improved technology. This is because there is similarity in kind of services offered by all companies involved.
However, suppliers may have influence in offering technologically improved equipments since there is vast number of suppliers within the market making competition stiff amongst suppliers hence equipments low prices. This makes Town Sport Inc and other companies within the industry depend so much on membership revenue due to high bargaining power of buyers.
Low costs involved within the industry has made it easier for consumers to control prices prompting the company to lower prices for the purposes of remaining competitive through increase in number of customers. This presents one of the biggest challenges since low prices benefit consumers but decreases industry revenue returns.
The company faces high threat of substitutes based on high presence of other recreational activities. Outdoor activities have remained popular and some of the activities are cheaper compared to gym subscriptions. However, such activities can at times be affected by weather presenting an advantage to gymnasium facilities. The other substitute includes home-based exercise equipments found amongst higher-income consumers with limited free time (Barney, 2007).
Conclusion
Town Sports Inc strategies mainly target increase in number of customers, and enhancement of their loyalty to the facilities and services. The organizations main task involves retention of loyal customers within regions served and beyond. This ensures consistent increase in market share for various services provided. Managing the task of capturing attention of potential clients assures that the fitness company receives positive results.
Native Floral Group has 13 regional facilities that span their reach from the west coast to the east coast. It provides freshly cut flowers globally with Rainforest Alliance Certified growing partners and enjoys a respectful image within their industry.
Native Floral Group is expanding to Canada and seeks to assess the pros and cons with regards to the current industry. Native Floral Group faces competition from Kendal Floral which also distributes the same product, freshly cut flowers, to western part of United States. Kendal Floral has three distribution facilities, located strategically in the west.
The southern California facility of Kendal Floral caters to the regions of Southern California, Arizona, Utah and Nevada, the central facility in Monterey Bay centre distributes products to Northern California, Nevada, Utah, Colorado and Idaho while the Northwest division caters to Oregon, Washington, Idaho, Montana and Canada (Kendal Floral n.d.).
Bargaining Power of Suppliers
Native Floral Group seems to have an edge over its suppliers due to its alliances with 473 farms all around the world. Barney (2007) affirms that when a company has the choice of procuring from a large number of suppliers, the power of suppliers to threaten the companys profits is less (p. 74). This provides the company with the advantage of bulk purchasing which eventually reduces its cost, thereby giving it an edge to offer highly competitive prices to its customer.
Bulk supply allows lower cost and competitive pricing
Large number of suppliers
Alliances with 473 farms worldwide
Procured direct from growers on a global level
Bulk purchases reduce costs
Strategic placement across the US provides transportation advantages for procurement procedures, sourcing techniques
Buying Power of Customers
Native Floral Group appears to have good control of its pricing due to various reasons. The state of the art technological tools employed by the company including coolers maintained at 34 degrees, climate controlled production areas and a fleet of owned trucks. Barney (2007) states that if a firm has a single buyer of only few buyers, this can be threatening to the company.
Native Floral has a wide distribution network with 13 regional facilities from the west coast to the east coast all across the country. The distribution and logistics strategies by the company in its several strategically placed production capacities in several cities across the country, give it the added advantage over its customers, with its high quality products and services.
High demand
Strategic placement all across the US for enhanced distribution
Excellent transportation facilities for distribution process
Proximity to major cities and stores
Increasingly popularity of online trading
greater quantities and varieties of flowers for sale
heightened competition from emerging countries
Online Services preferred
Threat of New Entrants
Native Floral Group enjoys a strong position due to its strategically planned production and distribution channels. According to Barney (2007), when present companies have a sound distribution of channels, new entrants have to bear huge costs to create similar channels of distribution to compete with the existing players.
However, Kendal Floral, a competitor to Native Floral, has three major distribution facilities, located strategically in the southern, northern, western and central parts of the US, which give it the leverage of expansion in competition to Native Floral.
New Entry Easy Easy to enter the Canadian Industry. Canada with an iindex rating of 81.6% and an (IBA global average) of 64.5%, makes it easy for establishing a foreign-owned (LLC) within 6 days and only 2 procedures.
Government subsidies of up to 50% funding to firms with revenue for farmers
Several tax incentives to natives to set up new business in Canada to generate necessary revenue
Low barriers to entry
Easy to expand globally with online set up
Economies of scale
Distribution and logistics strategies help in reducing costs and expenses
Legislative and government action Constant measuring of impact measurements, especially environmental. Social impact for workers rights, pesticide use
Limited financial capacity to grow business overseas
Experience and technology needed to expand globally
Threat of Substitutes
When there are alternative products available at lower prices, the company is at threat of losing its market share. Substitute goods for cut flowers available in the market are a constant threat. Native Floral Group needs to understand the changing dynamics of global economic conditions in order to press toward sustained growth and development. Some factors which threaten the company are:
Brand loyalty changing consumer attitudes
increasingly popularity of online trading
Cross product substitution
Competitive pricing with substitutes
Competitive Rivalry
Native Floral Group has an edge over its competition due to its strategic placement and ability to procure cut flowers worldwide, purchase in bulk and reduce its production costs. However, Native Floral Group does not have a website, unlike its competitor Kendal which has a fully functional site with complete company details.
highly competitive pricing
transportation facilities located in close proximity to major cities
High quality production processes
Highly trained staff
Its experience of the industry knowledge, its leadership, history
No online exposure or plans for future
Limited resources for setting expansion in other parts of the world
Conclusion
Native Floral exhibits a strong potential to succeed in its expansion plans by entering the Canadian market. It has the opportunity to collaborate with the Costco wholesale group and develop new facilities, which will increase their profitability. This will create new jobs in the Canadian farming industry while allowing them to increase their purchasing power.
The legal procedures of establishing a business in Canada are easy and Native Floral could enjoy government benefits provided to companies which offer new streams of revenue for farmers in Canada. In addition, by starting operations in Canada, Native Floral will be able to increase its competition against its closest rival, Kendal Floral, which already has northwest division, supplying produce to Canada.
Native Floral should seize the opportunity by taking advantage of the grants offered by the Canadian government to the farming sector. The Canadian expansion will also provide Native Floral the prospects of employing experienced individuals to develop business and implement marketing programs to increase company volumes and profitability.
With the available incentives and grants offered by the Canadian government, Native Floral can develop facilities near the Costco locations and attain the required leadership to press ahead in the global floral industry. Expansion to Canada will thereby help Native Floral in increasing its competition with Kendal Floral, which seems to have an edge with its supply to Canada and online website.
References
Barney, J. B. (2007). Gaining and sustaining competitive advantage (3rd ed.). Upper Saddle River, NJ: Pearson Prentice Hall.