Organizational Structure3
Industry: Competitive Advantage and Differentiation..4
Past Performance of Cesim-Mobile Inc.5
Current Conditions- SWOT Analysis.6
Significant Issues6
Strategic Plan7
Advertising.8
Consumer promotion..9
Sales force expenses...9
Public relations9
Service Delivery..9
Other..10
Conclusion..10
Executive Summary
The report centers on Cesim-Mobile Inc. The company is a leading a major player in mobile production. It aims at achieving competitive advantage over and above what its competitors enjoy in the marketplace. This report is a strategic business plan covering an examination of the organizational structure, strategic plan and the analysis of the situation that the company has been through. The situation analysis covers the periodic performance of the company. On the other, the organizational structure indicates the hierarchical arrangement of the roles and responsibilities that the employees of the company’s employees. The structure also depicts the supervisory role of the management of the company.
Organizational Structure
The Chief Executive Officer
The Chief Executive has an administrative function in the company. The CEO supervises all the operations of the company by working hand in hand with the subordinates. The subordinates give feedback to the CEO. The feedback covers all the operations of the company. The CEO ensures that the company is working towards achieving its organizational objectives.
Head of Marketing Department
The marketing department is responsible for the sales department of the company. The head of the marketing department ensures that the company maximizes its sales. The department does this by investing in aggressive advertising and offering quantity discounts.
Production Manager
The production department produces what is required in the market, in the right amount and at the right time when the customers require it. The department evaluates the consumer trends and then sets out to produce goods and services as required by the clients. The head of department insists on quality production.
Finance Officer
The last section is the finance department. The department deals with the cost factors of the company’s operations. The department evaluates the performance of the company basing on the surplus generated after the company has paid all its debt obligations. The department also carries out a valuation of the company’s assets.
All the heads of department report to the CEO but they work independently of each. In some cases, the heads of department can work together on various projects that require the output of the overall organization. However, they maintain their specialized functions during such projects.
Industry: Competitive Advantage and Differentiation
The mobile market is a very competitive industry. The market has many players. The participants include well established companies that have been in the market for a long period. Major industry players include Samsung, Apple, Blackberry and Nokia. In such a competitive environment, it is important for the company to maintain optimum levels of operations. The company’s products should exhibit high levels of creativity. The company should make its products in a way that can be appreciated by the customers.
In the mobile industry, there is a threat of new entrants into the market. In addition, the investments made often involve high costs. The mobile phone industry is highly concentrated and four firms control almost 80 percent of the total market. The threat of new entrants is low because the cost of staring a mobile manufacturing company is very high. Mobile manufacturing requires extensive capital outlays because of its utilization of complex technologies. Therefore, the success of a mobile manufacturing company depends on its ability to achieve economies of scale.
The company can make its products and services differently. This is called differentiation. It enables the customers to clearly distinguish its products from those of its competitors.
Past Performance of Cesim-Mobile Inc
The analysis of the company’s past performance is based on the financial performance of the company. At the end of the financial period, the finance officer makes an analysis of the company’s performance using financial ratios. The ratios compare the variables involved in the company’s operations. The ratios are used to determine how well the company is fairing based on the values derived. The following ratios have been used to evaluate the performance of Cesim Mobile-Inc.
- Operating Profit Margin
The operating profit margin indicates the percentage if available revenue to cover the expenses of the company’s operations and generate a profit. A higher profit margin is better than a lower one. The trend of this ratio should be upward. The ratio is given by:
Sales revenues – Cost of goods sold
Sales revenues
Cesim Mobile-Inc has a ratio of 0.322 based on the income statement. Its revenue can cover the expenses more than 0.3 times.
- Current Ratio.
The current ratio shows the ability of the firm to pay its debt obligations as and when they fall due, using assets that can be converted into cash. It is given by:
Current assets
Current liabilities
The company has a ratio of 1.32. The ratio is good for the company since it should have a ratio of more than 1.
- Working capital ratio
Higher amounts of working capital are better than lower ones. Higher amounts indicate the company has adequate internal funds to finance its daily operations. The company has a working capital of nearly 800000 units. The amount is adequate is for the firm to finance its operations. It is given by:
Current Assets – current liabilities
The three ratios have shown the performance of the company from three perspectives. The three perspectives are revenue, liability and working capital.
Current Conditions- SWOT Analysis
Strengths
Cesim – Mobile Inc is a leading manufacturer of mobile phones and its main strengths include the provision of user friendly products and its ability to produce cost effective products. The company is able to offer cost effective products of its economies of scale. The company focuses on providing customers with phones that meet their needs to communicate among other uses mobile technologies. The brand name Cesim – Mobile plays a critical name in the company’s ability to assume a leading position in the market. Cesim – Mobile has a strong brand name in the market and most of the customers can recognize with the brand. According to a recent survey, an overwhelming number of customers revealed that they could easily recognize the Cesim – Mobile brand name. Most of them noted that they associated the name with cost-effective and user-friendly mobile phones.
Cesim – Mobile’s ability to form joint ventures has been critical in the company’s success over the years. In comparison to its competitors, Cesim – Mobile has been successful in entering into new markets because of its use of joint ventures. Most of its competitors have been unable to enter into new market because of their inability to form partnerships and alliances with other businesses. For instance, Cesim – Mobile Inc has entered into numerous joint ventures in the Chinese market for mobile phones. The company’s partners in China assist the company in its manufacturing, technology, and software development functions.
Weaknesses
The company’s main weakness is that it has limited presence in the global marketplace. The company’s primary market is the United States which is responsible for over 70 percent of the company’s total sales. Even though the company has operations in other countries such as Germany and India, it is missing out on the growth opportunities available in Asia as well as Africa. Recent economic reports suggest that Asia is among the leading markets for mobile phones. China’s growing population is an attractive market for most of the mobile manufacturing companies. The company has been exporting its products to overseas markets but the performance has not been impressive because there are not direct retailers. The other weakness is that the company has lagged behind in the introduction of innovative products that complement consumer needs. For instance, Cesim – Mobile failed to introduce mobile phones using the android application which has led to loss of market share.
Significant Issues
Competition
There is high competition among mobile manufacturing companies because of the rapid emergence of new technologies. An increasing number of mobile manufacturing companies are investing huge amounts of financial resources in research and development projects. Extensive research has enabled these companies to develop innovative products that drive competition in the marketplace. Since most of the manufactures enjoy economies of scale, there is high competition among members of the mobile manufacturing industry.
Labour Unions
Most of the mobile manufacturing companies enjoy economies of scale though the use of cheap labor. However, there have been concerns that mobile manufacturers engage in child labor in an effort to minimize the costs of productions. Consequently, labor unions have formed a formidable alliance with their employees to pressurize mobile manufacturing companies to offer good working conditions and compensations
Strategic Plan
Mission Statement
“To offer flexible and quality services and products to small, medium level, and corporate customers at the most affordable prices so that business is carried out across all classes of customers.”
The existence of then Cesim – Mobile and its employees exist because customers are the most important part of the business. The absence of customers implies that the business will cease to exist (Johnson, G. & Scholes, 2002). Since customers form the nucleus of the business, it is the responsibility of the company to offer them with the best services and products in the marketplace. In any business setting, customers play a crucial role and they are the bosses. In the event that they are not in picture, the business cannot prosper. There is the need to develop good customer relationships with the employees. Proper training must be availed to all employees of the company to ensure that all the customers are served with the highest level of hospitality and professionalism. In an effort to ensure that the client’s needs are met, the company will ensure that they go an extra mile and make necessary follow ups to ensure the progress of their services and products with their customers. In the event there are complains then necessary steps must be taken to ensure they are corrected.
Business Strategy
The company’s overall business strategy is integrated cost leadership-differentiation strategy. The company will achieve a competitive advantage by offering unique product at affordable prices. The rationale for choosing the strategy is for the business to combine the benefits of both cost leadership and differentiation strategies. All the strategies of the enterprise are all aimed at capturing the customers, minimizing the costs of operation, and maximizing the profit margin of the company.
Objective 1: To offer cost-effective products
The company will aim at increasing its level of production because it assumes that high sales volumes lead to low units costs and high profits. Since the company is facing stiff competition from low cost manufacturers, Cesim – Mobile will reduce its product pricing so as to compete effectively. The strategy requires the company to identify a price that can enhance market share without hurting the company’s bottom line. It will be effective in emerging markets because of the relatively low market purchasing power (O’Sullivan, 2010). To ensure that the company is secure and can counter the competition from its competitors who offer lower prices on the same market product. The company must ensure that all their prices are lowered to a reasonable margin that can maintain all the processes of the company.
Objective 2: To enhance product availability in the market
There are numerous opportunities in the market for mobile phones and the company can maximize such opportunities through strategic placement of products so that consumers can have easy access. The company must ensure that products are made available to all kinds of customers at all levels. Phones should be made available from the lowest cost to the highest ones so that The Company has been lagging behind its competitors because of its inability to avail its products in places that consumers can access them with ease.
- Production
- Acquisition of the latest technologies at affordable costs so as to achieve efficient production.
- Outsourcing part of the production functions so as to maximize on the quality of the final product and minimize the cost of production.
- Mass production so as to reduce unit costs and maximize on profits in the long-run.
- Marketing
- Social media marketing
- Celebrity advertising because celebrities can influence consumption patterns
- Product rewards through competitions
- Marketing research so as to identify existing consumer demands and preferences
- Finance
- Enhancing investments in research and development activities so that the company can identify the most effective level of production.
- Budget reviews so as to minimize wastage of financial resources
- Projected Operational Plans
The business is expected to incur huge expenses in marketing the business and its new product. Marketing activities will involve:
Advertising
The company will erect approximately fifteen thousand billboards in the US at an estimated total cost of $4000000. It is expected that approximately 2 million people will view the billboards since they will be strategically positioned in places with very high human traffic. The billboards are very conspicuous making it probable that any person passing near it will have its view (Plunkett, 2007). In addition to this, the company is expected to create a website bearing its name where people can visit and view the kind of services and products offered. More than half of the total population of the US government is expected to use the internet for their normal activities. Creating blogs on social sites that are often visited by people like Facebook, twitter, yahoo, Gmail, and others will be employed to ensure that the company is well marketed across the internet. A huge investment is expected to marketing of the company through making advertisements.
Consumer promotion
Since the product is new in the market, it is expected that consumer promotion will be an effective marketing activity in attracting new consumers. The company will offer a 20% price discount in the first three months of operations at an estimated cost of $ 10,000. Approximately 200,000 customers are expected in the first three months since most of the customers in third world markets are used to free things and cheaper items than the prevailing market price (Kurtz, 2011). Comparisons will be made by from other companies so that the promotions are made in a way that they do not affect the stability of the company.
Sales force expenses
The business will employ around 200 sales force employees to market solar panels in the rural areas. The use of sales force is expected to yield close to 400 sales calls a week at an estimated cost of $ 13000 a month covering commission, salaries, wages, and travelling expenses. Marketing of the products will be conducted in a way that they can minimize the funds required to finance fixed asset purchases.
In order to carry out this successfully, the main strategy in place will be to identify alternative sources of money together with their tangible and intangible costs. In order to minimize on the expenses required, the company will ensure that it spells out clearly the maximum debt levels that can be offered and the minimum cash balances that can be allowed.
Public relations
Public relations will involve using unpaid media in promoting the new product. Newspapers are expected to monitor the installation of the power supply plant. The company will be made public by setting up a date and making an official launching that will include the attendance of all stakeholders and key business share holders.
Customer service
The company will offer phone services for its customers. This is expected to record a high number of customer referrals of approximately 100 customers in a month. However, the cost of customer service will be incorporated in the price of the product. Products will be produced at the lowest price possible so that any profit made would have an influence on the overall profit margin realized.
In order to achieve this move the co0mpany will ensure that they identify all the elements that constitute the product cost and try to minimize or control all these elements. The move can be affected by including it as the minimum levels of inventory or safe stock needed to avoid the costs of a stock out.
Other
Other marketing activities will include sponsorships where the business will partner with the government of emerging economies to sponsor technology projects. The company will select customers and offer free phones. It will cost around $50,000 to finance the sponsorship. It is expected that we will capture a 20% market share in the first three months since almost 95% of the population do not have access to affordable phones (Johnson, G. & Scholes, 2002).
Conclusion
The report in this context report provides Cesim – Mobile with a strategic direction that will ensure its success in the marketplace. Even though the company operates in a competitive market, Cesim will adopt an integrated cost leadership and product differentiating strategy. The company will combine the individual strategies of its departments to achieve the overall business objectives.
References
Johnson, G. & Scholes, K. (2002). Exploring Corporate Strategy, 6th Edition. New York: Prentice Hall.
Kurtz, D. L. (2011). Contemporary marketing. Australia: South-Western Cengage Learning.
O’Sullivan, K. (2010). Strategic Intellectual Capital Management in Multinational Organisations. Hershey: IGI Global.
Plunkett, J. W. (2007). Plunkett's wireless, Wi-Fi, RFID & cellular industry almanac 2007. Houston, Tex: Plunkett Research.
