Making losses and not meeting set objectives are two issues that all organisations must be wary of. Goals are set to be met and therefore failure in meeting goals is a depiction of problem that are either in the organisation or in its operational environment; this can also be said of making losses which is failure to meet a key goal of any business entity which is making profits (Shim, Siegel & Dauber 2008).
It is therefore important for any organisation to be aware of its operational environment and the nature of its processes to ease the process of identification of threats and opportunities to ensure effectiveness in operations (Johnson, Scholes & Whittington 2008 p. 172). ,Entry into any industry segment is a complex process and should be based on factual information since failure in analysing the environment may culminate in the collapse of the business enterprise that may have been avoided had more emphasis been placed on the true nature of the environment (Arussy 2005, p.
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55). The development of strategies that will ensure opportunities that exist in the operational environment are harnessed effectively is just part of daily logistics and operations. To ensure effectiveness all processes have to be effective and goal oriented (Bryson 2004, p. 56). Success in any business entity is not just measured by the profit margin an organisation achieves in normal economic times but can also be determined by the nature of their operations during financial hard times and their approach to crisis management.
B&Q Company has in the past being growing at a constant rate as it enjoyed a large market share due to the advantageous competitive edge it had established. Increase in competition as new players came into the market has had a negative impact on the company causing a tremendous decrease in sales hence profit margins. This situation has called to company's management to seek strategies that can be implemented to enable it regain the profitability it enjoyed before.
This case looks at the current company and financial situation of B&Q company determines the strategies that can be developed to ensure that the company resumes the large market share and competitive advantage it had that enabled it to record high sales hence large profit margins. Best Strategies that can be implemented to bring B&Q back on track The current B&Q operational environment is characterised by a large number of dynamic variables whose behaviour can not be precisely determined.
The company's success hence depends on the strategies it implements (Monks & Minow 2008, p. 23). Creativity and innovation is one of the strategies characteristic of most if not all successful companies that enjoy high sales and huge profits. Innovation as an approach to business operations is associated with high levels of efficiency and cost effectiveness (Gilad 2003, p. 11). Though different from each other, innovation and creativity complement each other and are desirable qualities that organisation should look for in their employees.
In order for B&Q to regain the making the high profits it was before, the management has to reintroduce and emphasize on this culture in the company (Kao 2007, p. 33). Creativity and innovation enables the company to come up with different ways of production that may be cost effective. It also enables an organization to come up with new designs and products. This is important as it makes it possible for the company to diversify in its production. The company will be able to produce a range of goods which makes it possible for the company to increase its sales.
Creativity and innovation would also enable the company to make many different designs of their products which is appealing to consumers as it gives them a variety to choose from and also gives them a reason to come back to the stores (Griffin 2008, p. 22). The company could also employ a market based approach in its operations. This involves identifying what consumers need in the products being offered and designing them accordingly. Market based approach means that the company gives consumers what they need and not what it thinks is good for them (Eilon 1999, p.
102). Satisfying consumer needs should be the sole purpose of any strategy being implemented. This is because a company can not sale anything unless the consumers are satisfied with it (Merna & Al-Thani 2008, p. 22). An organization can not survive without sales hence the need to please consumers. Identifying consumer needs and any changes in their behaviour will give the company an upper hand against its rivals. Consumers want products that are of high quality, stylish, functional and whose price is sensible (not too high).
The company can find out the specifications from the consumers and design its products in a way that they meet them. The company will also need to identify any changes in these needs especially design and keep at par with them. This will attract consumers and increase sales hence the profit margins (Soros 2008, p. 33). Another strategy that B&Q could implement in order to beat its competitors and record high sales is by increasing the range of goods the company produces and launching new designs of their products more frequently.
Having a range of products is a way of diversification of the company's production. This enables it to have an option to fall back on in the event that the performance of one line of production is negatively affected. This approach takes the form of not putting all of your eggs in one basket. Having a variety of designs especially for the home and house furnishings. Consumers have different tastes and require the producers to give them a variety to choose from (Johnson, Scholes & Whittington 2008 p.
180). Launching different designs periodically gives consumers a reason to come back to the stores as they look at latest arrivals. Women consumers love new stylish designs and could be taken advantage of this away (Melewar 2008, p. 22). B&Q deals with products that require it to employ individuals to assist the consumers. The way a company handles consumers matters a lot. Customers need to be treated in a way that is satisfying to them (Griffin 2008, p. 66).
B&Q should ensure that the customers are given all the assistance they require whenever they visit their stores whether they are purchasing anything at the time or not (Kotler & Armstrong 1999, p. 22). Providing good services is appealing to customers and always make them want to come back or refer their friends to the company's stores. Employing strategies that will ensure this will increase the company's competitive advantage hence sales resulting to higher profits. Marketing is an important aspect that determines a company's sales and profits.
Marketing has been termed as one of the best ways of dealing with competition. Marketing which involves making consumers aware of a business' products, convincing them to buy and maintaining them is a must for any business that wants to establish a market for itself (Hooley, Piercy & Nicoulaud 2008, p. 65). Marketing and advertisement are heavily utilised by industry players as each player in constant search for opportunities that will give them an advantage over others. In order for B&Q to overcome its current situation, it has to re-evaluate its marketing strategies.
The company needs to ensure that the marketing strategies employed are effective such that they reach the target group of consumers and explain what the company offers convincingly. Marketing is a powerful tool for increasing ones sales. It enables consumers to be aware of the company's new products or designs of certain brands. The company should ensure that the marketing tools implemented have a message that is satisfying to consumer needs and expectations of the products. Marketing and advertisement should and must always be objective (Hazell & Fitzpatrick 2006, p.
75). Focussing on ways through which the competition can be dealt with rather than how to deal with an organisation is important in ensuring objectivity and therefore giving and edge to the promotional approach that will be employed as it complements the true nature of the organisation thus effectively ensures that the service offering are transmitted to the market segments (Luecke 2006, p. 11). The company hence needs to employ the best marketing strategies it can in order to contain the competition that is causing it to reduce its sales hence profits.
Most successful organizations have identified team work as one of the best ways of solving problems especially those that need multiple judgements (Simon 2000, p. 132). The problem facing B&Q is not one that can be solved by an individual. The management needs to form a team that will come up with solutions (Hare 1999, p. 6). Teams consist of individuals with different skills and experience hence have the advantage of producing solutions that are diverse. Teams could give a variety of solutions enabling the company to have other options in the event that one solution fails to work.
How the strategies can be put into action, problems expected in implementation and their solutions. The company can encourage innovation and creativity by rewarding the employees that get involved. Rewarding motivates employees and encourages them to be entrepreneurial and innovative as they seek to benefit from the rewards. The company should also ensure that resources are available so that those involved in innovations have enough material and equipment that is needed for them to be successful (Johnson, Scholes & Whittington 2008 p.
45). One of the problems expected in implementing this strategy is lack of financial resources to buy the equipment that may be needed for some innovations. This problem can however be solved by ensuring that those involved in innovation work everything a set budget. This strategy if not well manage may lead to innovations that are not in accordance with the company's values and culture. Sometimes employs come up with ideas which are good but can not be implemented as they divert from the company's values.
The management can prevent this by effectively communicating to the employees the company's culture and values. The vision and mission statements should also be done and the employees encouraged ensuring that they work aiming at the vision while maintaining the culture and values of the company. Market based approach is implemented by the company carrying out a market survey of the consumers in order to identify their needs and behaviour (Dettmer 2003, p. 52). This strategy is best implemented by using focus groups to study the market (Stewart, Shamdasani & Rook 2006, p. 61).
These groups are a representation of the consumer population and the information received from them enables the company to identify consumer needs hence work towards satisfying them (Boone & Kurtz 1999, p. 61). Market based approach involves looking at consumers and giving them what they need. It has a disadvantage in that consumer needs always change hence require the company to be constantly carry out the surveys so as to keep at par with the changes. This could be expensive. Focus groups are also not representative of the entire population as their needs might be different from those of other consumers.
Information derived from focus groups is also not 100 per cent accurate as the possibility of influence by members of the group is always high. This problem can be solved by developing prototypes from their information which are then launched in the market and consumers' reaction to them observed. Production of a range of products rather than specializing in the ones the company already offers can be implemented by contracting other companies that produce the products that the company wants to offer under its license.
This strategy however has a problem as the contracted company might not have as good organizational values as and high standards or qualities as B&Q. In the event that the contracted company gets involved in a crisis, the reputation of B&Q is threatened (Monks & Minow 2008, p. 56). This problem can be solved by the company ensuring that it carries out through search on a company and its operations before contracting it (Rothwell & Kazanas 2003, p. 23). Launching new designs of products periodically such as after every month can be implemented by employing experienced designers in the industry.
This strategy is a bit costly as it involves employing professionals. The company however will need to do it if it wants to maintain the competitive advantage it has so far acquired. These designers will ensure that new designs are made as required and within the time that they are required. There exist several marketing tools that can be implemented in marketing. The best tool to be used by B&Q would be advertising through the media and carrying out and promotions.
Advertising however has a problem as marketing and service promotion are aspects that have been widely integrated into the dynamic of operations as every player in the industry is advertising through the same media and therefore getting the attention of the target market is challenging as the nature of the industry does not provide the diversity that may be useful in pulling the markets' attention towards a specific company's service offering (Churchill & Peter 2005, p. 12). Advertising as an approach to creating awareness on an organisation's services is as effective as the context of its use (Kao 2007, p. 25).
Another disadvantage of advertising is that the cost of advertising in the current operational environment is so high and organisation cannot afford to be subjective in their decision to engage in intensive marketing or promotional activities (Ward 2004, p. 25). Another problem in advertisement and promotional approaches that leads to subjective decision is benchmarking competition (Shim, Siegel & Dauber 2008, p. 66). There are different level of competition in any specific industry segment under which many entities have benchmarked their competitors and counter all the moves made by the benchmarked entity.
Under such an approach an organisation's strategies towards marketing are influenced by the competitor and therefore lacks in objectivity. This problem can be solved by the company being objective in its advertisement. Objectivity can be established by focussing on the cause of the competition rather than the manifestation of competition which is the competitor. The company could also use other marketing tools such as offering discounts on their products so that they are sold at relatively lower prices as compared to those of their competitors (Farese, Kimbrell & Woloszyk 1999, p.
73). This should be done in a way that will not hurt the organizations profitability. Prices should be a bit lower but just low enough to enable the company to recover the cost of production and make some returns in terms of profits. Teamwork as a management strategy is associated with the development of synergy and therefore maximization of the benefits got from the organisations resources. A team approach to operations helps in the development of a team approach and complement the use of innovation and creativity (Campbell, Stonehouse & Houston2002 p. 54).
The management of an organisation that employs the use of teams in its operations is easy for the simple reason that teams are at a higher level than the individual and therefore the entities that the organisation deals with are reduced (Cassidy 2005, p. 17). The formulation of the teams should ensure that the team members complement each other and should put into consideration both individual competencies and professional qualification. The company's management can form groups from employees with different skills and experience from the various departments.
Best groups are formed by individuals with diverse knowledge as they use different approaches to the problem (Russell & Linda 2005, p. 41). Sometimes groups suffer from influence by one individual especially if he holds a high position at the workplace. Such individuals influence the solutions reached such that they are not collective (Barksdale & Lund 2006, p. 1). This can be solved by ensuring that everyone participates and their opinions are considered. The final decision should be reached at by a majority vote for it to be collective.
The teams should also be empowered such that they are not influenced by the management (Brody 2004,p. 41). The solution they come up with should be should be implemented by the management. B&Q can also effectively implement teamwork strategy by developing a proper communication framework which entails the formulation of a good communication policy and the development of a physical communications system that is relevant to communication in and between teams complements the efforts of team building and ensures efficiency in coordination of organisational efforts (Barksdale & Lund 2006, p.
22). Conclusion B&Q's current situation is filled with uncertainties due to the high competition in the industry and the fluctuating economic conditions. Opportunities however exist but most of them are so complex and resource intensive that few organisations have the capacity and willingness to take a risk and exploit them. Though risk taking is associated with success, the risks taken must be calculated (Arussy 2005, p. 65). The above strategies are worth implementing if the company wants to get back to track. Some are a risk which is characteristic of any business.
The management should however ensure that it carries out the strategies in a manner will ensure that they maintain or increase the competitive advantage and large market share they have. The strategies should also enable the company to be well placed to manage financial hard times with considerable ease. Word Count: 2900. References Arussy, L 2005, Passionate and Profitable: Why Customer Strategies Fail and Ten Steps to Do Them Right! , London, John Wiley and Sons. Barksdale, S & Lund, T 2006, 10 Steps to Successful Strategic Planning, Washington DC, American Society for Training and Development.
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