Successive Business Strategy For Achieving Objectives and Goals by Assignment Desk

A Sample Report on Business Strategy

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Table of Contents INTRODUCTION .......................................................................................................................... 2 TASK 1............................................................................................................................................ 2 1.1 How business mission, vision, objectives, goals and core competencies affect strategic planning ................................................................................................................................. 2 1.2 Analyse the factors that have to be considered when formulating strategic plans for TNT. 3 1.3 Evaluate the effectiveness of techniques that are used when developing strategic business plan......................................................................................................................................... 5 TASK 2............................................................................................................................................ 7 Organisational audit................................................................................................................7 Environmental audit............................................................................................................... 8 Stakeholder Analysis.............................................................................................................. 9 New strategy for TNT.......................................................................................................... 10 Alternative strategies............................................................................................................ 11 Justification...........................................................................................................................12 Assess the roles and responsibilities of personnel who are charged with strategy implementation .................................................................................................................... 12 Analyse the estimated resource requirements for implementing the new strategy for TNT14 SMART objectives............................................................................................................... 15 CONCLUSION..............................................................................................................................16 REFERENCES.............................................................................................................................. 17

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Illustration Index Illustration 1: SPACE Analysis....................................................................................................... 6 Illustration 2: BCG Matrix...............................................................................................................7 Illustration 3: Stakeholder Analysis...............................................................................................10

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INTRODUCTION Business strategy refers to the various ways by which an organisation can effectively achieve its objectives and goals. It also called as long term planning of the companies for accomplishing their objectives in efficient manner. In this strategy is game plan of the firm's management which is used for strengthening its performance and work efficiency. These strategies include SWOT and PESTEL analysis. Business strategies are generally developed by organizations for attaining different objectives in effective manner. These strategies play important role in growth, development and success of an organization. The current research project is based on Business strategy. Regarding this, it focuses on TNT express which is operating its business in courier industry of UK. It is an international company which is engaged in express and freight delivery service (TNT Express launches PharmaSafe, 2016). It includes internal and external environment of the organization which are required for developing new strategies of an organization (Ă&#x2026;kerman, 2014). Along with this, it also shed lights on current and future strategy of the company. Further, it includes different models and theories for developing appropriate tactics for an organization. Including this, stake holder's analysis will also be completed by this investigation. In addition, appropriate process of future strategic implementation plan is also describing in the following paragraphs of the report.

TASK 1 1.1 How business mission, vision, objectives, goals and core competencies affect strategic planning Strategies have to be planned by keeping in mind the objectives of company. TNT has kept their customers at the core of their strategies. Company makes sure that all the stakeholders have been involved in the decision making. TNT follows a strategy map which aligns the entire organisation together (Al-Ansaari and et.al., 2014). This makes sure that aims, objectives, mission and vision are according to the strategies of entire organisation. Further, it is using balance scorecard method and has been awarded for its exceptional performance in the industry. Operational activities are linked with the strategy and it has shown remarkable growth for them (Aversa and et.al., 2015). Their vision is to become the most admired company and increase their sales. For this, they have made sure that proper plans are followed by all the departments in the organisation to achieve desired goals. They have realised the importance of customers and 2

various services which are provided to them (Baddache and Nicolai, 2013). So, they have incorporated all these in their objectives and planned to accomplish it. Identification of TNT’s mission, vision, Explanation goals, objectives and core competencies Mission

 Exceed customer’s expectation

Mission of TNT is to provide

 Deliver value to customers by excellent

services

its

providing efficient and reliable customers. It has planned to services

maintain the same level of

 Lead the industry by creating services across the globe. values and taking responsibility Vision

 To become the most admired TNT has clear vision and it has company in the industry

formulated strategies and plans to ensure quality services.

Goal

 Achieve 2% sales growth annually TNT has planned to expand and attract more customers constantly.

Objective

 To achieve profitable growth

maintain

 To reduce carbon emission by 45% relationship till 2020 seconds Core competencies

with

stakeholders

 Answer customer calls within ten business

healthy various

and

with

grow

sustainable

development.

 Efficient transportation of goods or Strength documents

attracting

TNT

lies

customers

building

 Enhancing customer satisfaction

workforce

 Responsible behavior

expectations of the customers.

level

and

 Providing quality services

 High caliber workforce

high

which

of meets

1.2 Analyse the factors that have to be considered when formulating strategic plans for TNT High standard of services that TNT has been able to achieve is a result of its business strategy. Strategic planning begins with the formulation of Mission and Vision statements. After that, goals, objectives and aim of the organisation are decided (Dameron and Durand, 2013). Further, current situation is accessed by considering the internal and external environment of business. Important factors that have to be considered while formulating strategies are: Internal factors: Such factors include employees, management, physical and financial resources etc. These are very important and a strategy cannot be formulated without considering these factors. Support activities: These activities include infrastructure of the firm, skills needed in the workforce, technology, assets and inventory (Doole and Lowe, 2008). A firm cannot develop a strategy without taking all these factors into consideration. Primary business activities: Primary activity of TNT is to transmit goods and provide quality services to the employees. They have to ensure that customers are satisfied with the services that are given to them. External factors: Such factors which affect business are competition, preferences of customers, economy, tariffs, rules, recession and inflation. Plans have to be altered by keeping in mind the changes in business environment. Strategic challenges and facilitators for TNT are: ď&#x201A;ˇ Fierce competition: TNT has been facing tough competition from DHL and Fed Ex (Ferreira, 2013). As a result, they change continuously their strategies and plans to remain competitive in the market. ď&#x201A;ˇ Growth of B2C: TNT is a B2B company and there has been a significant rise in direct customer service. It is a major challenge for them because they have to include such thing in their portfolio to remain competitive (Few and Few, 2013). Plans have to be altered and this perspective of business has to be included. ď&#x201A;ˇ Slow growth in Europe: Growth rate has been slow in Europe and they have to look for other opportunities for business. For that, TNT is planning to expand their business in China and Brazil. These factors have affected the business but there are some positive effects for the company which facilities in the formation of strategies and plans. These are as follows: 4

 Worldwide presence  Cost efficiency  Exceptional customer service  Balance scorecard development  Good relationship with customers  Efficient technology  Strong product portfolio  Huge network  Large market share 1.3 Evaluate the effectiveness of techniques that are used when developing strategic business plan Business strategies provide a direction and helps the business to achieve its goals. These are generally long term in nature. TNT has been successfully performed their strategies in the recent past and has been able to maintain its distinctive position in the industry. Techniques which can be adopted for the development of strategic business plan are: SPACE Analysis: This technique helps the organisation to formulate its future strategy (SPACE Analysis, 2011). SPACE matrix in context of TNT Company depicts that it has to adopt aggressive strategy in the business. It has strong position in the market and company has been growing at a rapid pace. It has been providing its services in more than 200 countries of the world. It has been performing excellent in terms of providing services and customers have been loyal to it (Lin and et.al., 2013). Though it has some competitors and it is affected by the nagging business environment but still an aggressive policy will be better for them. They should include this while formulating their business strategies. In past years as well, they have been carrying out the operation to gain competitive edge in the industry.

BCG Matrix: Such matrix determines the position of company on the basis of its market share and growth rate (Longoni and Cagliano, 2015). If TNT incorporates this technique in their strategic plan then such will help in making it more effective. There are four categories in this matrix:  Cash Cows: These produce more revenues and consume less. They are ones which are leader in the the mature market (Nuntamanop and et.al., 2013). Their value can also be determined using the present value method as they generate a stable cash flow for a company.  Dogs: The dogs have low market share and low growth rate. They don't even consume large amount of cash.  Question Mark: They are those which grow rapidly in the market and they consume large amount of cash. They have relatively low share in the market and generate low revenues as well.  Stars: They are very strong in the market and also generate large returns. Their growth rate of very high as such they consume large amount of funds (Okereke and Küng, 2013). A company's portfolio should have stars which will become cash cows in near future and keep generating revenues for the company.

At present, company is in stars stage which indicates that they are moving forward in their business. Market share of the company is high and their overall growth rate is also high. They have lot of investments in the market and more investment is also needed (Panicker and Manimala, 2015). The BCG matrix can be a useful technique for TNT to develop its future strategy. They are in a stage where they have to continuously remain competitive in the industry otherwise their rival will take over. It is for the same reason that TNT has been expanding its business and increasing their existing product portfolio.

TASK 2 Organisational audit Organizational audit is a technique used by the management of a company to find out the strengths, weaknesses and challenges associated with the business. It is very beneficial as it helps an organisation to evaluate various factors that can affect it (Priego and et.al, 2014). All the elements of micro and macro environment are taken into consideration. The best technique to analyse the strategic position of TNT is SWOT analysis. The strength of the company lies in its quality services which are provided to customers. TNT is a market leader in Europe and it 7

provides services in more than 200 countries. The objectives and vision of the company is clearly defined (Ritter and GemĂźnden, 2004). They use latest technologies and the has highly trained workforce. The biggest weakness for them is the environmental aspect in which they work. There are safety issues, transportation problems, punctuality and other environmental factors which causes problems in their operations. Threats are also prevalent in the industry. The competition level is very high and companies like DHL, FedEx etc are trying to capture the market (Santos and Baptista, 2015). Furthermore transportation problems, security of the goods, climate, transportation all have their influence in the quality of the service. Even though TNT has to face lot of threats from the external sources but there is ample of opportunities for them. It is a global company as such its has more opportunities to grow (Schrager and Madansky, 2013). They can also expand to other countries like China and Brazil. The development of communication system and transportation has allowed them to improve their service and make it more quicker then before. The customers have been loyal to allow as a result they have huge customer base (How to do SWOT, 2016). The customer services that are provided is one of the best in the industry and this gives them the competitive edge that they want. Environmental audit An environmental audit helps an organisation to gather all the useful information about the environment in which it is operating. TNT has its presence around the globe as a result it is affected by all the global changes that are happening. PESTEL Analysis is an effective technique to study all such factors (PESTLE Analysis, 2016). The political factors are of utmost importance to them. Many nations does not support foreign identities in their countries and for a global company this could be a problematic situation. Apart from this, economical factors such as interest rates, exchange rates, inflation, demand and supply also affect the business. All these factors play a vital role for a global company (Wagner and Svensson, 2014). TNT also takes into consideration all the social factors during communicating, promotional and at the time of delivery. Each country has its own culture, preferences and lifestyle and all of these have to be included in PESTLE analysis. Technology can be also useful for improving the customer service. The improvement in transportation, communication and innovative methods of delivery can improve the quality of the overall services (Winnard and et. al., 2014). It is essential for the company to adopt to new technologies and introduce innovation in its business activities otherwise they will lag behind in the industry. The environment factors and the social 8

responsibility of the company have to be considered in environmental audit. The world is moving towards sustainable development and it is expected from all the organisations to implement in their mission strategies as well (Robbins, 2016). The macro factors would be incomplete if the legal element is ignored from it. Each country has its own legal framework. They have different regulations and guidelines which have to be complied. TNT has to consider all such legal necessities that has been laid down by the country in which it is operating (Mozaffarian, 2016). The macro environment has major influence in the business of a company. Therefore a proper understanding is required so as to ensure that the business is not affected by it. Stakeholder Analysis Stakeholders includes all those people who are affected by the decisions of the company. These include employees, customers, creditors, community, government and suppliers. When a company is about to introduce a new strategy for its business, all the stakeholders have to be considered at that time. For this a technique known as stakeholder analysis is used (Koda-Kimble and Young, 2016). It is helpful in identification of key stakeholders and the effect on it during the decision making. TNT Company is planning to adopt Growth Strategy in their business. It will not only help them to expand but it will also ensure profitability in the company. In order to incorporate this strategy in the business TNT has to identify its major stakeholder. For them employees, customers and the community are the key groups (Longoni and Cagliano, 2015). The next step is anticipate the influence on them if the company adopts to growth strategy. The influence could be positive or negative. Finally, they have to develop plans for successful implementation of the strategy (Ferreira, 2013). The biggest advantage of stakeholder analysis is that the management gets the opinion of all the key stakeholders for a particular plan. This will ensure quality as well as increased support for the decision. Furthermore, gaining support from the most important stakeholder allows an organisation to gain more resources. This technique would help TNT to implement the new strategy in the organisation (Ritter and GemĂźnden, 2004). They would understand the benefits of the project and the reason behind adopting it is also communicated to them. The company would also be able to anticipate the reaction of different people towards the project. These stakeholders can be compelled to support the growth strategy. Some of the people in the organisation has the power to block a particular project and if such situation arises for TNT then the whole business would fail (Al-Ansaari and et.al., 2014). A company cannot continue its operations without he support of different people associated with it. 9

There has to be sustainable development in the organisation. They cannot afford to lose the growth opportunity of the business just to keep the stakeholders happy. There has to be a proper balance between the objectives of the company and the stakeholders (Mozaffarian, 2016). The growth strategy is essential for them and it is not adopted then the competitors would take the advantage of it.

Illustration 3: Stakeholder Analysis (Stakeholder Analysis, 2015) New strategy for TNT There are many strategies which are can be adopted by TNT to ensure its growth in the long run. Their business has been growing at a rapid pace at the present moment but to ensure that the same pace continues in the future they have to bring changes in the company. To resolve this issue Ansoff matrix can be used (Okereke and KĂźng, 2013). This technique provides alternative growth strategies keeping in mind the present and potential growth opportunities of the company. There are four possible strategies that TNT can choose from. The best strategy for them would be Market Development. This would allow them to grow and expand their business in different parts of the world (Wagner and Svensson, 2014). It is already a global company as such this strategy would be suitable for them. It will also help them in gaining the competitive edge that is longing for. The low revenues in one region can be compensated by high revenue from the other area. Furthermore, the quality and price would also become competitive because of large scale operations. It will also open up doors for the company to have collaboration with 10

other successful local business in a particular nation (Winnard and et. al., 2014). They already have the reputation of maintaining the same level of services around the globe.

Market

Development would give them more market share and improve their brand name. It is difficult for them to adopt other strategies as the product portfolio is limited to courier services. There are already many other companies like FedEx and DHL who are in the same business. TNT is in B2B business and they can expand by including direct customer services (Lin and et.al., 2013). Both the business lie under the same segment so they won't be needing much of investment. The countries like China and Brazil should be targeted by the company. The have been dominant company in Europe and has the highest market share as well. So the best strategy for them is to use Ansoff matrix and find out different ways to expand their business. There is better growth perspective in the global market and many parts of the world has not been explored. Alternative strategies The alternative strategy that TNT Company can adopt is entering into new market. The biggest problem for courier companies is product limitation. They don't have lot of products in their portfolio. It would be better for them to adopt this strategy for their future. Recently, the company has introduced PharmaSafe which is a specialised service (Doole and Lowe, 2008). It offers transport of pharmaceuticals in a temperature controlled environment. Similarly they have to find new potential business in which the company can expand. The business is already facing lot of competition form its rivals. The growth rate has also slowed down in Europe so it would give them new dimension in the business. TNT has lack of opportunity to grow in the courier service as it is already a market leader as such this would help them (Ă&#x2026;kerman, 2014). They can also enter into collaboration with other business entities which would reduce their risk to a great extent. The other strategies like limited growth and retrenchment strategy is not recommended to them. TNT has large share in the market as such limited growth would cause lot of problems to them (Panicker and Manimala, 2015). The retrenchment strategy has to be adopted only in the stage of economic recession, recession, tough competition and inefficiency. In these stages a company can resort to asset reduction, revenue generation and cost reduction strategies. Both of these aspects of growth would cause the company to lose the business that they are doing. So the only option for them is market entry. The existing business has to be continued and it should be their core business (Nuntamanop and et.al., 2013). Other business opportunities needs to be accessed which has good future development chances. In present global scenario, many 11

companies are investing in other businesses. They believe that if the core business faces trouble in its operations then the other secondary business can support it. But before investing in other industry it would be better for TNT to make sure that the particular business has future growth potential. The inclusion of PharmaSafe is also a step by the company in trying out different service apart from regular business operations (TNT Express launches PharmaSafe, 2016). The company has lot of opportunities to grow they just need to plan it in a proper manner. Justification The market entry strategy is the best alternative for TNT company as it gives them more dimension in the market. They have been excellent in their existing business. The strategies and plans have been successful for them (Koda-Kimble and Young, 2016). The management has the capability to find new niches of the business. The courier business has some environmental threats and future it could become very big. Even if the business fail the other business can support it financially. They already have operational excellence and exception customer relationship. This would further accommodate the new business that the company is about to start (Schrager and Madansky, 2013). Furthermore, they have good business relation with the many corporate entities. This would also help the new business to grow. The company's strategy has already been awarded as exceptional and the this would attract potential business groups. So overall the company has been excellent in their business and to ensure that the overall organisation remain profitable they have to diversify (Few and Few, 2013). TNT company does not produce goods as a result they have their own limitation in the product portfolio that they have. Market entry serves all the needs of the company and they would get better chances of survival in the market. They also have the required resources like human resource, financial, labour, knowledge, technology etc which can be used to start up a new venture. Assess the roles and responsibilities of personnel who are charged with strategy implementation In order to implement the market entry strategy in Brazil, the personnel play a very crucial role. Hence the members of TNT have different roles and responsibilities to play in this domain. These have been defined in the below mentioned table. Members in the project team of Roles and responsibilities implementing the new strategy Top level management

ď&#x201A;ˇ for setting

a good work culture so that

strategies can be implemented in TNT in the best possible manner  Deciding

over

operating

plans

appropriate so as to allow a successful strategic implementation.  Formulate aim and objective for strategies that are in tune with mission and vision statement of TNT.  Monitoring and reviewing of the strategies.  The management should further motivate the bottom level employees for successful implementation of market entry in Brazil.  middle level management

 Taking operational decisions with respect to Communication, planning and control.  Making appropriate decisions with respect to strategy implementation.  Communicating roles and responsibilities to the

employees

who

are

involved

strategies.  Managing, controlling and reviewing the process

strategic

management

suggested by senior employees.  Measuring

success

strategic

implementation process undertaken by TNT management. lower level management

 Implementing strategies by allocating task to employees present in their respective department of TNT  Identifying the loopholes that exist in the

process of strategic implementation.  Communicating

the

issues

higher

management of TNT.  To have full faith in the employees so that market entry to Brazil can be carried out successfully.  Involve key employees through group consensus so that strategy of market entry in Brazil can be employed in successful manner.  Responsible for completing tasks that have been allocated by lower level management of TNT to them. business partners

 They play a key role in financing the overall strategic management plan that is being implemented in TNT.

Consultant

 These people can give valuable suggestions as to how the market entry can be carried in Brazil.

Analyse the estimated resource requirements for implementing the new strategy for TNT The proper implementation of proposed strategy being market entry by Brazil in TNT Can only be made possible when there is a presence of proper resources. These have been discussed below; Human resources – Employees form the biggest assets for any company as far as new strategy implementation is of concern. In order to implement the proposed strategy in Brazil the need is to implement experiences human resources (Priego and et.al, 2014). They should further have good knowledge about the economic as well as environmental conditions of Brazil. If possible proper training should also be provided to the team members so that they can implement the proposed strategies in a successful manner. The company should further carry out new hiring so as to develop competencies as per the proposed strategy(Wagner and Svensson, 2014). Along 14

with this, company can use various performance appraisals, motivational theories, training and development activities for increasing motivation and confidence level of the workers. This will help the firm in improving its performance and market position. Financial – TNT should further arrange for sufficient funds in order to implement the strategies in successful manner. The funds can be in form of bank loan, owner’s capital, venture capital among others (Few and Few, 2013). The company should also develop an idea about the forthcoming expenses so that finances can be arranged well on time by the top level management of TNT. These techniques will help the company in proper allocation and utilisation of the resources. Technical – the company in order to implement its market entry strategy requires technical resources in form of channels of marketing and communication(Baddache and Nicolai, 2013). The company may further require email facility so that the strategic plan can be communicated to employees. Along with this, TNT requires information and communication technique (ICT) for improving the communication between its employees and making their work more effective and efficient (Mozaffarian, 2016). On the other hand, firm can use Customer Relationship Management system (CRM) for maintaining its relations with the customers. This will keep the firm in touch with its users and also help in better understanding of their expectations and needs. Physical – There is further a need of physical resources for TNT so as to ensue towards successful strategic implementation in Brazil. These are in form of setting an office in Brazil, taking a building or premises for the same, deciding on furniture & fitting, lighting, stationery and telephone among others (Koda-Kimble and Young, 2016). SMART objectives For achieving the above explained SMART targets, TNT needs to follow the following steps: SMART targets will help TNT in effective achievement of its objectives. With the help of these targets, company will able to accomplish its objectives as per the requirement by using appropriate strategies and processes (Doole and Lowe, 2008). The three SMART targets of the organisation are as follows:  To increase productivity by 5% till the end of 2016.

ď&#x201A;ˇ To increasing training and development programmes for improving performance of the workers by 10% till 2017. ď&#x201A;ˇ To enhancing use of technologies by 7% till mid of 2017. These SMART objectives of TNT company will help in implementing the new strategy. For example, if the organization has developed a strategy of increase number of services in the different areas. By setting of SMART objective , firm will able to achieve it within the given time frame. The evaluation process shows that TNT company has increase the number of services in the different areas with effective manner. Along with this this, it has increased the organization market share in domestic and international market. But the negative aspect of this is enterprise has not conducted a proper market research with unable the firm to understand the needs of the customers. CONCLUSION Current research project has conducted internal and external environment analysis which have reflected that TNT business has strong capabilities in managing available resources. From the research, it has also identified that how business mission, visions, objectives, goals and core competencies has helped in making the strategic plans.

There have factors which has to

considered by the company during the formulation of strategic plans. With the help of the various techniques, TNT company has able to developed strategic business tactics. By using external and internal environment audit, management has planned the effective strategies. Along with this, diversification is one of the appropriate strategy for improving business. Regarding this, TNT needs to use a new market entry strategy in international market such as China and Beijing. As per the current study, top, lower and middle management, employees and business partners of TNT will play an essential role in implementation of market entry strategy. For implementing this strategy organization needs to make appropriate arrangement of financial, human resources and technology resources.

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