Operational plan
Charlie´s mini cab transport and accommodation is the small business, located in London with well-defined market segment, being South Asian students and tourists. Already established on the market as the transportation provider the objective of the company on strategic level is to enter accommodation market will focus on the partnership with embassies and student agents. From operational perspective the above mentioned goals will be achieved through 3 critical initiatives on activity levels (Hubbard and Beamish, 2011, p.77-95):
- Settlement of the contracts with third-party accommodation providers.
- Cross-selling initiative and KPI setting.
- Acquisition of demand forecasting system and widening of the transportation pool.
It is critical to outline that the all the changes on the operational level will allow to maintain the 80%/20% split between operational commercial personnel. With that, such activating as hiring and departmental restructuring will likely become secondary activities, involving only small part of the business.
First of all, existing commercial structure of the company will help to create focus on the second activity – accommodation by shifting some of the sales and marketing force to the new segment. Operationally it will require creation of the third-party contracts for the accommodation and settlement of exclusive deals for housing to bring the value to the accommodation segment of the market. The company will focus on settlement of the deals for three segments: hostels, affordable hotels within the central areas of the city and B&B options for students.
Secondly, bringing down strategic objective to operational level it will be critical to create a robust cross-selling structure between transport and accommodation sector. This will be done through specific actions on marketing and sales levels, more specifically operational instructions will be created and distributed to meet the following targets: 1) promotional actions (discounts, special offer) for transportation solutions for the clients of Charlie´s accommodation, 2) cross-selling within the sales teams, driven by the motivation initiatives (cross-selling targets, internal competition, cross-training), 3) Clear financial Key performance Indicators (KPIs) and sales forecast for sales department, including both, transportation and accommodation segments.
Finally, logistics department will undergo operational changes that will include the increase in transportation pool to meet the long-term needs of the growing customer base. This will involve development or acquisition of several supportive systems (Donald and Waters, 2006, pp.120-135):
- Demand forecasting and P&L projection tool for the growing organizational needs
- Capacity management tool to be integrated to the projected e-commerce structure of sales.
- Cost management tool to include the increased transportation pool and logistics costs.
It is critical that the company is prepared on the operational level to meet the sales forecast and adjust to the reality as the core of the business is the logistics activity and coherence. Hiring of drivers to boost the capacity of the transportation department will put the company in the position to rapidly respond to the needs of both segments. Main costs at this stage are related to the adaptation and acquisition of IT solutions to meet the organizational needs.
References
Hubbard G. and Beamish P. (2011). Strategic Management: Thinking, Analysis, Action. 4th Edition. Frenchs Forest: Pearson
Donald C. and Waters J. (2006). Operational Strategy. London Thomson Learning.
