Houghton Mifflin Company, Business Proposal Example
Words: 2814Business Proposal
Summary of Business Strategy
To become the premier interior designers of choice by creating a trail blazing lobby designs that enhance the comfort and attractiveness of our clients lobbies as well as making the clients entire premises customer friendly and a home away from home. We will endeavour to make the experience that our clients customers have in the waiting lobbies is one worth remembering full of warmth and giving the employees a feeling of environmental bonding and motivation.
Our interior design business is to be administered by increasing efficiency and reducing wastage of time. The ability to achieve this mission will be underlined by the following core competencies. One of the core competencies that our interior design business will build is filling its idle time through diversifying its products. The diversification of the products ensures that the designers will be busy or in at work at all times since different clients need different designs at different times..
To ensure good services to all clients company will seek utilising increased facilities and also by ensuring high quality services as well as diversifying its service offerings. Apart from all these efforts the company will include several other design enhancement opportunities through customer consultation this includes indoor as well as outdoor designs. For example if the firm was to hold serious client consultations and make educated suggestions on design improvements, we can keep an ever improving design portfolio and a very satisfied client portfolio.
We will seek to identify our client’s needs and ensure that we incorporate them into out designs. Similarly we will invest our best efforts to customer sourcing and identification of the earliest opportunities to diversify our designs. The defining quality of an entrepreneur is the ability to identify opportunities and utilize them and develop them into a business that has good returns on investment (Money matters). The entrepreneurial ability of our design business is underlined by the way we seek to identify opportunities and develop them into money making opportunities. This is underlined by our ability to identify the idle time reduction strategy and utilise it to our advantage.
Our vision will be to create a point of first call for interior design needs of all our clients and create a good customer satisfaction record. We will aim at acquiring and keeping a good client portfolio and ensuring that our clients are long lasting clients who take pride in our services and always come back for our services.
According to Jones (2000), strategic management as the process through which an organization formulates implements and evaluates decisions that will help the organization to achieve its long-term goals. The process involves tabling the organizations mission, vision and objectives after which policies and plans designed to achieve these objectives are developed and finally allocating resources to implement the policies and plans. Strategic management is a continuing process which evaluates and controls an organizations business, assesses its competitors and sets strategies to outcompete these competitors.
Understanding the Environment: SWOT Analysis
For us to be manage to see to fruition our vision and mission we need to understand the circumstances under which our business will be operating. Thus said, it is of essence to do an environmental analysis and understand it. We can only understand this through SWOT analysis. SWOT analysis is tool for environmental monitoring that enables the business to evaluate both its internal abilities and capabilities as well as evaluate the external factors that might affect its performance. In conducting a SWOT analysis, one is able to figure the effectiveness of the strategy adopted. SWOT analysis, analyses the strengths, weaknesses opportunities and threats in the adopted model. This helps marketers to focus on key issues as well as assisting the strategic apex of the business to design the best responses to meet the market forces and ensure the business continuity is assured.
While doing SWOT analysis, opportunities and threats represent external factors. Threats include things like price wars with competitors, an upcoming competitor in the same market and competitors with superior access to channels of distribution or even imposed taxation on your products. Opportunities could be mergers or strategic alliances, changing market segments to get more profit, a market vacated by incompetent competitor, an international market among others while strengths and weaknesses are internal factors; Strengths are aspects that add value to an organizations product or service. This could be quality processes, location of the business and specialist marketing expertise. A weakness on the other hand, could be damaged reputation, lack of marketing expertise, and poor quality goods or services undifferentiated products in relation to competitors among others, (Saloner, G, Shepherd, A and Podolny, J. 2001).
SWOT analysis generally involves analyzing both the external and the internal factors.
With this understanding, we will evaluate the factors by grouping them into either external and internal factors, for the internal factors firms look at the strengths and weaknesses while for the external factors firms look at the opportunities and threats. The opportunities mapped into our strengths to help us get the best attack strategies while the threats addressed through ensuring that our weaknesses managed to reduce our risk levels. This will be the guiding light in the operations of our business. This said, we construct a SWOT analysis table to help us determine the factors that face our business.
|Strategy||Our strategy will be to identify new market while doing aggressive marketing to eat into our competitors market share||Our plans to hold customer awareness meeting might be hard to sell to some customers who view their time as being very precious|
|Structures||We will base our operations in an open office floor to enhance teamwork||This might hinder the recognition of the pecking order and create personal conflicts|
|Processes and systems||We will have a customer portal for online customer consultation||The competition might use the portal to gain access to our private information|
|Resources||Use of the latest cutting edge design inventions and software’s||We will find it hard to distinguish ourselves since the competitors also use the same tools|
|Goals||Our goal to be the point of call far as interior design is concerned becomes our guiding light||The competition will also have their own goals towards which they are highly committed|
|Strategic capabilities||We will use the best tools to enhance our value||The tools might get phased out with time hence the need to keep up to speed|
|Culture||Our culture of openness and client engagement will help the clients feel valued||We might come across as being unsure of what we want to deliver to the clients|
|Technologies||Our embrace of the technology as the tool for delivering quality will enhance our delivery.||We might fail to get and retain the experts in the field who can make the best use of the technology|
|Innovations||We will be doing a regular review of our designs to determine whether they meet the best standards||Efforts to come up with highly innovative designs could strain our resources and reduce our profitability|
|Legal and regulatory||The legal and regulatory framework allows for setting up of enterprises and encourages self employment||Failure to comply with the revenue requirements can lead to investigations and subsequent fines|
|Global||The world market has opened up to cross border trade therefore, it is easy to sell our products outside the country||Some countries have serious drawbacks against foreign companies and this can pose a problem to our operations|
|Economic||The economic recovery means increased spending which we can cash on and grow||The current situation means it will take time before the expenditure picks up.|
|Technological||The current technological advances mean that can reach clients with ease and deal with them with speed||Some clients may have technological challenges, which may hinder our ability to serve them.|
|Innovation||Our innovations will help us get an edge in penetrating the market||The competitors are likely to have their own innovative designs that we have to fight with|
|Social||The current push for better lobbies and the society being more keen to good designs will make our designs a necessity||Our designs will be subjected to criticism by a more informed society which might make our work harder|
|Environmental||The business environment has become more competitive hence the need for well designed lobbies||The competitors have also become more aggressive meaning we have to work harder to beat them|
|Competitive analysis||If we understand what the competitors are offering, we can work on improving their work and delivering better designs||The competitors may as well analyze our designs and keep improving on them|
This analysis thus helps us to align our business strategies to be able to respond to the existing business challenges as well as mitigate the inherent business risks. The company has to exploit a strategy that will help it fit well into the market and the choice is informed by the prevailing market conditions and the effort to attain a strategic fit. For a company to fit into its market through development of proper strategy, then accurate forecasting of the market environment is necessary, (Eliot, Timmerman & Granger 2006). The accuracy of the market forecast that a company develops determines the degree of strategic fit that it can achieve.
To achieve the objectives stipulated in the balanced scorecard, we need to evaluate the all the stakeholders needs in the business. These different stakeholders include and are not limited to: shareholders, customers, processes or operation as well as the human capital. Each of these stakeholders need to realize value in the organizations as well as achieve their objectives. In view of these facts we evaluate the perspectives and how we will meet their needs. In meeting these perspectives we will ensure that we have a matrix of interconnected synergy. We will address all these perspectives as follows.
Shareholder Value or Financial Perspective
The shareholder value perspective is concerned with the returns that the shareholders are able to obtain on the investments that they have put into the company. The strategy seeks to gain as much of the market share as practically possible considering the available resources. Similarly the shareholders seek to see their capital generate high revenue as well as sufficient profitability and attain an enviable position in the market.
|Market share||To ensure that we raise our market share to a good proportion||Raise the market share by 5% every year|
|Revenues and costs||Ensure that our total revenue is high in proportion to financing costs.||Ensure that we raise our revenue by 30% in every year|
|Competitive position.||We ensure that we rank among the highest performing organizations in the market||Make sure we are ranked amongst the five highest players in the market.|
Customer Value Perspective
The customer value perspective seeks to utilize strategic objectives to deliver an distinctive customer experience. The fruits of distinctive customer experience are measured through the ability to retain customers where customer loyalty is high. The customer response surveys also help to establish the extent of the customer satisfaction. The value delivered to the customers is a part of the metrics that ought to be evaluated.
|Customer Retention or turnover||Ensure that we keep track of and retain our customers hence we do not lose them to the competition||Maintain customer turnover to not more than 10% that only come with natural attrition.|
|Carry out customer satisfaction surveys and ensure that we have favorable customer feedback.||Ensure that we receive at least 75% favorable customer feedback.|
|Ensure that our customers get value for their money through distinctive service||Ensure that our prices are among the five lowest prices while maintaining quality.|
Process or Internal Operations Perspective
In evaluating internal performance, it’s the only way that the organization can establish how well the implementing arm of the organization is keeping in line with the laid down and updated strategic objectives. This comes by way of measuring the performance of processes putting into mind the resources in terms of manpower that have been deployed in the process. The productivity of a process is also measure as well as the productivity of the entire organization as this is important in establishing how well the operations are aligned to the overall long term strategy of the organization. The operation metrics of the organization helps as they function as the benchmark against which the performance of the organization.
|Process Performance||To ensure that our processes have minimum wastage and the productivity is favorable.||Record a constant 90% favorable performance on all our processes.|
|Measure of process performance
|Target to record minimum idle time and therefore make sure that efficiency is at the highest||Ensure that machine idle time is maintained at as low as 2% per week.|
|Productivity or productivity improvement
|The productivity of our organization will be maximized closest to the budgeted return at all times||Ensure that they we never go more than 10% outside the budget.|
Learning and Growth (Employee) Perspective
Growth and learning in employee perspective embodies the opportunities that the employees are granted by the organization to grow and advance in their careers and development. The ability of the organization to grant the employees access to the latest technology and the organization encourages the participation of the employees in the organizations planning as well as demonstrating capability for future growth as well as encouraging employees to participate in decision making. The working environment is a key factor that determines whether the employees leave the organization or whether they remain for a long period.
|Ensure that we meet our employees expectations.||Aim to get a 85% favorable response on employee satisfaction|
|Employee turnover or retention
|Aim at retaining our employees so that we do not lose skills to our competitors..||Ensure that we minimize our employee turnover to just the natural attrition figure of 8% and not more.|
|Technological innovation||Keep and make use of the latest innovations in technology at our workplaces.||Ensure that we hold quarterly trainings to update our employees technical skills|
To implement these strategies we need to have appropriate information technology applications tactics. The information technology tactics will be three fold, we will seek to develop a virtual organization and this will call for an effective information technology applications. The virtual organization is therefore described as one consisting of employees who are physically separated and kept apart from one another which results into what has been described as a “company without walls” (Galbraith 1995). We will secondly develop standardized communication templates that will enable us to communicate effectively and efficiently within the organization. We will then develop tailor made design software for use in our design development and this will go a long way in ensuring that we deliver quality to our clients.
To measure the effectiveness of our organizations strategies, we will use two approaches; the first will be the client satisfaction surveys. These will give our clients a chance to evaluate how we have performed in the process of delivering the service to them. We will then be able to respond contemporaneously as we develop other client service strategies. The second tactic will be the use of audits. We will perform both systems and financial audits every year. These will help us discern whether we are posting healthy financial
To achieve these milestones we need to ensure that there is sufficient and effective communication as well as appropriate monitoring and evaluation of the progress made in the implementation of the objectives help keep dynamism in development and growth. Since we need this key value it is important to update the implementation of a strategic plan to keep our employees on their toes. This implies that the updating of the goals is done to reflect the changing environmental situations as well as respond to any changing ethical as well as regulatory requirements for the organization. The communication of the strategic plan is vital in ensuring that the people involved in implementation are full informed of any changes that affect the deployment of resources as well as manpower towards the implementation of the strategic plan. The strategic apex will therefore take the responsibility of communicating the updates as well as the changes in the strategic plan to the middle management who then turns it into implementation goals. This is because the strategic apex is the top leadership and the decision making organ in the organization (BPP 2009).
BPP Learning Media (2009). Corporate and Business Law. London: BPP Publications.
Eliot, T, Granger, J & Timmerman, A (2006), Handbook of economic forecasting, Elsevier, Sydney.
Galbraith, J. R. (1995). Designing organizations. San Francisco, CA: Jossey-Bass.
Jones, R and Hill, C (1999) Strategic management: An integrated approach, Houghton Mifflin Company, New York.
Saloner, G, Shepard, A & Podolny J (2001), Strategic management, John Willey, Washington.
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