Computer Sales Business Concept Strategic Management Plan

Introduction

The computer sales strategic management plan was designed to address the business idea and concept of selling new and refurbished computers both in the local market and the international market depending on the trend in demand , market forces, and opportunities that lead to an increasing demand for the products in the market. According to Freeman (2010), the phases of the strategic management plan were based on different sections of the strategic management concepts consisting of the description of business operations, the vision and mission statement, a design of the factor analysis for the business, internal factor evaluation matrix, competition in the global market, strategies in action in the local market, team approach to strategic analysis, and the strategies to build a leadership culture for the organisation (David, 2007).

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The key guiding principles in the strategic management plan included making it a people based process, enabling a learning process for the management of the proposed management business plan, based on numerical analysis of facts, based on simple and non-routine implementation approaches, draws broadly on new research findings, and is under the control of the strategist.

The Nature of Strategic Management

Strategic management is defined as an art or process through which business strategists intuitively design or formulate business strategies to implement business ideas or concepts that have been subjected to rigorous evaluation of the appropriateness to achieve organisational business goals and objectives (David, 2007). Typically, the corporate goals include the obsession with customers where the business is started with the customer and working backwards, being innovative by listening to the forces that contribute to the innovation process, and making every opportunity to count for the growth and competitive advantage of the business.

It was at the responsibility level of the strategist that the business at the corporate, strategic and functional or operational levels was defined with the necessary roles and responsibilities to ensure the success of the plan were done. Here, the underpinning success was based on business intelligence reports gathered from different sources on the market opportunities of selling computers and related hardware and software products (David, 2007). In addition, the strategist played a significant role in identifying the competitive advantage and performance of the proposed strategic business management plan.

Strategic management is a cross functional discipline constituting the marketing, financial, production, information systems, and research and development targeted at exploiting existing and current opportunities with the aim to introduce a feasible business idea or concept for implementation. Strategic management here is referred to as strategic planning because every element of the strategic planning process was used to formulate the business strategy to exploit current and future opportunities. Here, the process should be done by the top management and be made continuous, cross functional, iterative, and long and short term that draws on complex decision making capabilities using the available resources.

From an historical perspective, the strategic management concept emerged in 1950 and gained popularity for many years with many companies adopting the concept and idea as the company’s game plan (David, 2007). The challenges presented in many business environments, the need to address the economic problems that continue to pervade the business world and the challenges to exploit new business opportunities underpin the strategic management planning concept.

The business idea

The strategic management plan was defined by a strategy formulation that provided a detailed description of the business idea. It was necessary to determine the suitability of the strategic management plan for penetrating the new market based on answers on who, what, and where the business idea could work best. The business idea was to sell new and refurbished computers and computer related hardware and software products.

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The strategy was conceived by the strategist who intuitively provided leadership in conducting a strategic analysis and strategic planning of the computer business opportunities that existed in the local market and the expanding demand for computers in developing markets. The rationale was to make the business develop a competitive advantage by exploiting the weaknesses inherent in rival companies that had specialised in similar business. The local market is dominated by giant computer companies and which do not address the specific needs and expectation of the customers at the interpersonal levels.

Typically, a historical evaluation of the computer business operations were dependent on large corporate entities such as IBM, Microsoft, Gulf Computers LLC, Datazone systems limited, Acer Middle-East, and Dell computer among others that have little or no presence on the retail market in the UAE. Most of the low end customers were small private enterprises that were poorly stuffed with service providers who were not skilled in the computer hardware and software and often provided poor services.

Strategy definition

The definition of the strategy was in context of the computer sales business that was contrived by the strategists who identified a business opportunity to exploit in the local and global market. The business strategy was defined as a business plan to provide new and refurbished computers and related software and hardware products that were customised to meet the needs expectations and offered at competitive prices.

The pricing strategy was based on profit maximization, image acquisition, increase in market share, in pursuing long term and short term profit maximization, matching the competitor process and even reducing them, which could lead to lower profit margins but increase in the market share, increase of the volume of sales, and ensuring that customers could negotiate product prices as opposed to the rival companies that offered their products at fixed prices. The market consideration underpinned the pricing strategies and not the cost function.

Strategy implementation

The strategy implementation was based on a comprehensive analysis of the internal and external environment, to determine the strengths, weaknesses, opportunities, and threats in the business environment as described in table 1 below. It was determined that the strategy be formulated based on the definition of the business plan objectives that consisted of the overall strategic business idea and the need to exploit new and dynamic business opportunities that were identified in the local market (David, 2007).

At the action stage of the strategic management plan, the necessity to implement the strategic management plan was established after reviewing the plan to take corrective actions and implement the plan according to the recommended framework of implementing the plan at the corporate, business, and operational or functional levels of the organisation.

The cooperate level

At the corporate level, it was determined that the management was responsible for taking the leadership responsibility to identify and implement the strategic business plan by formulating policies that could provide the business rules for implementing the strategic plan. The policies provided the rules to pursue and achieve the business objectives (Hitt, Ireland & Hoskisson, 2012). The study shows that the strategic objectives could be defined in terms of the financial, marketing, and management levels.

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It was at the corporate level that the management identified the business opportunity and coordinate the portfolio of the business. Here, at the corporate level, several issues that were related with the business strategy were clarified. The issues include clarification of the business goals and objectives and the strategies to use to integrate into the strategic management plan.

In terms of the market, the strategy would focus on optimising the local market before making an entry into the international or global market (Hill, Jones & Schilling, 2014). The responsibilities include the strategies for governing the business units based in different strategies such as corporate intervention, use of persuasion and rewards, and development of business interrelationships. In addition, the cooperate level takes the responsibility of coordinating the staff that could be involved in marketing and selling the computers, ensuring that the appropriate financial resources such as paying for salaries based on the concept of corporate strategy and synergy.

Business level strategy

The proposed business level strategy was based on the need to provide the customer with good quality computer made of good quality hardware and software products that could provide the new business with cost leadership, differentiated offering products at affordable and variable prices, cost focus, and differentiation focus to offer the customers with a wide variety of products at different prices. 1.4 Strategy management model

Strategic management model.
Figure 1: Strategic management model.

Objectives

Having conducted the SWOT analysis of the internal and external environments, it was crucial to establish the required objectives after the model description was done defining the implementation framework.

  1. To design a strategic management plan for selling computers and related products
  2. To develop a strategic management plan for implementing the business idea

Literature Review

Business mission and vision statements

Vision statement

The vision statement was created by the business organisation planning to start the computer hardware and software sales services and was designed to be the leading provider of new and refurbished computers, hardware and software products both in local and global market.

Mission statement

The mission statement was to be the leading provider of the best computer hardware and software products that are tailored to satisfy and exceed customer needs and expectations in the local and global market.

The strategic management plan was implemented by using the strategic management model to address the implementation process of the business idea. The model is represented diagrammatically as shown on in figure 1 below.

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The External Assessment

The external environment of the business idea to sell computers and computer related products and services were assessment to determine the strategic approaches address the threats and opportunities that could arise. Here, it was the work of the strategist working with the corporate level managers to conduct a SWOT analysis was conducted by identifying the emerging opportunities that were based on the opportunity to sell computers in the market (Swayne, Duncan & Ginter, 2012). The strategist, working in the level of a support staff established the existence of the opportunities and the need to fill the gap in corporate and divisional performance.

A comment on table 1 shows that the strength of the strategy was to be optimised on a competitive pricing mechanism that was based on the market and not the costs, use of reliable local and internal marketing channels, and the ability to develop a strong brand name for the business. In addition, the opportunities identified by the business strategist included stimulating demand for the computer by competitively pricing the products, establishing the service and product provision at the interpersonal level (David, 2007). On the other hand, the threats that were identified to include the changing business environment, taxation laws, competition from other firms, culture, and population.

Opportunities

Opportunity SO strategy WO strategy
Familiar environment Use local sales people to make direct sales and services Employ more workers
Better trained people Evaluate skills gaps to establish the ones to fill Use a human resource management strategy
Vendors reputation Build goodwill through better service delivery Educate employees on the service delivery best practices
People across the demographic divide use computers Increase market presence through adverts Use the websites and other cost-effective marketing platforms
Ability to build strong brand name Advertising Using the web

The use of a familiar local environment and networks to build a strong demand for the products and services both locally and in the international market using reliable distribution channels.

Threats

Threats ST strategy WT strategy
Changing business environment and the demand for new computer models Keep ahead using market intelligence reports for products in demand. Create a new website and blogger
Increasing competition from existing firms Improve the pricing strategy Purchase low cost products from external suppliers
Taxation laws Compliance Consider those flexible compliance requirements
Limited resources Work within budget Increase stakeholders
Threats from the economic environment Identify products that fast Invest in cheaper products
Population culture not yet strong in use of computers Use less environmental pollution products Encourage environmental consecration measures

Weaknesses

Weakness Counter Strategy Implementation Strategy
Non trained staff Train staff on marketing strategies Use in house training, seminars, and other appropriate tools to train the employee’s for better performance
Finance Invite more stakeholders Increase shareholder’s capability

Strengths

Strengths S strategy I strategy
Ability to develop a strong brand name and recognition within the business environment Use the websites and other marketing sites
The pricing strategy was based on different competitive elements such as market consideration and not a cost consideration. Similar services and products were bundled together to offer competitive pricing, a strong understanding if the value proposition, and ability to build customer perceptions about quality and value

Space matrix

Conservative Aggressive
Market penetration-low pricing strategy to enter the new market and offering free services and product and after sales services
Product development-No product development strategies, but new products were bought from the external suppliers
Backward and forward integration-The integration was done by using both the local and external suppliers.
Market penetration – not aggressive
Defensive Competitive
Retrenchment-No retrenchment strategy was done, no divestiture, and no liquidation was experienced. Backward and forward integration for competitiveness by linking with local and external suppliers

The Internal Assessment

An assessment of the internal environment was based on different variables that were identified to have strategic effects on the performance of the business and could be controlled by the existing management (David, 2007). For instance, the current business management plan identified the existence of untrained personnel. However, according to the proposed plan, it was necessary to recommend various training and development options to be able to motivate the employees to improve the performance at the place of work to increase the productivity of employees according to the proposed business plan to increase f profits, market penetration, market size, and to ensure better implementation of the marketing penetration and growth strategies.

Another approach that has been recommended for internal assessments includes conducting an assessment of the organisational culture and the resource based view of the company (Swayne et al., 2012). According to the strategic management plan, the resources were deemed to be sufficient for the execution of the business and management tasks necessary to succeed in the business. Those resources include financial resources to purchase the computer hardware and software products to sell and the human resources required to provide professional advice on the computer hardware and software products to buy that meets customer needs expectations (David, 2007).

In addition, marketing resources such as on-line presence will be provided by different e-commerce platforms and the presence of the Internet that provides a virtual platform for customers to view the product and services to be provided and be able to conduct secure financial transactions on the virtual platforms.

On the other hand, an internal audit revealed that the managerial issues were necessary to ensure the effective execution of the strategies defined in the business management plan. Among the proposed strategies include formulating marketing strategies and policies that target the market and the employees to improve productivity and strategy implementation. The strategic approach was to establish a value system of the founders that could enable them to lead the organisation along the lines of the organisational business policies that are consistent with the mission and vision statements of the new business (Swayne et al., 2012).

The proposed business plan includes identifying an organisational structure consisting of the chief executive officer, the general manager and some departmental heads such as the marketing and sales department and the human resource department.

The management plan has factored sufficient financial resources from business stakeholders interested in the computer hardware and software business operations. In addition, the physical location for the proposed business is to be at the central business district to that provides good and secure communication facilities. In addition, it is the point where customers alight when travelling to different destinations in the country besides being a point of attraction for the tourists and many people from different parts of the country coming to do business (David, 2007). The company has posed to develop a website and other physical resources that might help in the execution of business operations.

Performance measurement will be based on market share, debt to equity, earnings per share for the stakeholders, sales growth, organisational assets, profit margins, and return on investment.

Competing In the Global Marketplace

The global market has thousands of companies that are well established in the computer software and hardware business and a strategic management plan is necessary to create a competitive advantage for the proposed company. Among the proposed strategic management plans is to use the e-commerce, the use of applications such as Skype, and EBay’s e-commerce platform to conduct the studies (Swayne et al., 2012). The eBay Marketplace provides a virtual platform to host different products that will be offered by the company and provides a platform where buyers and sellers meet.

In addition, the proposed e-commerce site provides could be used as a platform to solicit and provide feedback to the managers and other interested stakeholders on the performance of the business. The platform could be used to provide virtual platform for creating loyalty programs, enable on-line advertising, and provides a platform for secure e-payment systems. Each communication segment that includes communication, payments, competition, marketplace competition, Skype competition, and the economic climate need to be factored to create a competitive company in the computer hardware and software company.

Other factors that need to be considered include the business environment, the political and legal environment, such as long term and short term contractual relationships, and due consideration of piracy and copyright laws. Most of the computer products such as software are easily pirated and the specific consideration of the internal environment such as website usability will be considered. A usable website will be designed to allow for scalability and for scalability and stability to be enforced, the website will be designed to allow for the customers to conduct financial transactions and any other transactions necessary on the web. In addition, the website should be designed in a way to enable the company’s customer services department to offer additional support services to the customers.

Additional issues to factor in the strategic management plan include the ability for the employees and the organisation in general to train employees how to be more persuasive, emphasizing on the quality of the product in the market, controlling expenditure and avoiding unnecessary expenditure, and taking direct aim at the competitors. In addition, it includes computer and software products and services based on competitive pricing strategies, creating excellent and reliable distribution channels in the local market, and conducting a marketing research before the products are sold. Here, the leadership will be required to conduct a market audit based to understand the characteristics of different target segments, the position in the market against competitors, conducing market research activities, ensuring that the product meets the customer quality needs and expectations.

Strategies in Action

The strategies to put in action to make the business successful in penetrating the computer software, hardware, and related business operations include creating or formulating long term objectives that include increasing the sales by 10% each year, increasing the size of the target market by 3% for the first year and subsequent increase by 5% until the final growth rate of 10% is achieved. At the corporate level, the general direction of the company will be defined by the main objective which includes increasing sales at the local and global market which will subsequently lead to an increase in profits (David, 2007).

In addition, it is defined at the corporate level that the business strategy to purse includes selling new and refurbished computers besides offering after sales services and providing copyright protected software tools for the customers. In addition, the strategic approach of making the business competitive includes using a low pricing product and services pricing strategies, using different e-commerce platforms to create a strong presence on the internet.

The proposed business level strategy includes establishing strategic alliances with companies that operate in the market, diversification of computer software and hardware products, optimising on the core competencies of the organisation such as when offering products and services at low prices, integrating the concept of product and services differentiation such as offering after sales services that are not offered by existing firms in the market.

At the functional level, it is proposed that trained personnel on computer hardware and software will be employed to provide the services necessary to the customers to make the company competitive in the business.

In addition, the strategic approach is to make the company the best supplier of computer hardware and hardware products and services the best in the local market and to increase the best practices in offering the computer hardware and software services and products at competitive prices based on best business practices. The strategy will help the company to increase its market share that will subsequently increase the profits and position in the market. The key areas to avoid include not managing by objectives, which includes managing by crisis, managing by subjective, managing by hope, and managing by extrapolation.

Strategy Analysis and Choice

Strategy Explanation Score (weight)
Score between 0 and 1
Forward integration Ownership is already in the hands of the founders of the company. Linking internal and external companies as the main stakeholders into the business. 1-has already been applied because of the nature of the business
Backward integration Ownership of the business
  1. Already in place
Horizontal integration Ownership and control of the business
  1. Already owned by the main stakeholders.
Market development At its lowest level, but will improve to enable the company increase its market share. Use of websites, pricing mechanisms, interpersonal relationships, and effective marketing strategies such as offering free after sales services. 0.7- the score shows that the market needs to be developed further.
It is feasible to develop the market because of the existing opportunities.
Related diversification strategy Possible to add new products, low priced software and hardware products, Diversification will be along the computer hardware and software products such as providing support services or open source software.
Unrelated diversification Adding new products to the business to diversify revenue sources 0.1-Not a recommended strategy because it is necessary to concentrate on the market before diversifying the business
Retrenchment None 0
Liquidation Selling company assets 0

The table shows several strategies that were recommended in the strategic management plan. However, each strategy was assigned a weight on a scale of 0 to 1. The strategies that scored above average weight include the related diversification, Market development, forward and backward integration, and horizontal integration. However, the strategic approaches of implementing the strategies differ from one strategy to the other. The strategy that scored high figures was recommended and those that scored zero were not recommended for the business.

Implementing Strategies: Management and Operations Issues

Management and operations issues that were established for implementing the strategies include the ability to manage the internal and external forces such as threats and rivalry from existing business organisations by positioning the company’s pricing strategies and other forces for competitive advantage (Freeman, 2010). The underlying need is to improve the operational efficiency and increase profits by integrating different aspects of the implementation process that include the intuition and analytical skills, and coordination among the employees.

Here, the leadership will be required to show good and effective leadership skills that shall be achieved by devising new business policies, linking pay with performance, matching the management strategies with goals and objectives of the organisation, and in developing a strategy supportive culture (Freeman, 2010). To address all the issues, the management will be required, under the strategic management plan to motivate employees to participate earlier in the strategy implementation process to ensure that the organisation makes major competitive gains rivals. In addition, the objectives should be communicated earlier to the employees besides making them aware of areas that of competence of the major business rivals.

The operational issues establishing, implementing, and evaluating the performance of major business objectives, assessing the company revenues for target fulfillment, reviewing and writing new policies, reviewing issues such as overtime pay, smoking, moonlighting, insider trading, effective resource allocation, effective conflict management, and matching the organisational structure with the strategy at the functional divisional, and by restructuring, re-engineering, and e-engineering.

Implementing Strategies: Marketing, Finance/Accounting, R & D, MIS Issues

Different marketing variables such as using multiple distribution channels, advertising, taking a leadership in pricing, and rewarding employees to increase motivation by use of financial incentives consist the variables for marketing the business (Freeman, 2010).

The recommended marketing strategies for use in the strategic management plan include the use of social networking sites, encouraging consumers to participate in the marketing programs, create a strategy to attract more and more customers and resist the temptation to sell the products, use an advertising media that reaches a large audience, conduct a purpose based marketing strategy, segmenting the market according to economic demographics such as age, income, gender, education, and nationality to position the products in the market.

The proposed financial issues to address in the strategic management plan includes raising capital and the proposed sources include short term debts, long term debts as the business grows, and by attracting stakeholders. The proposed accounting include issues include using the right dividend ratio to determine the right dividends to earn, using the marketing values accounting approach to determine the amount of cash to be left at hand. In addition, the plan recommends the use of projected financial statements analysis as a strategy to evaluate the success in implementing the strategies. On the other hand, research and development (R&D) is a tool for searching for new ideas and information on new products to sell in the market (Freeman, 2010). Overall, the management information systems (MIS) to use should be designed with the correct features to support customer and organisational members in conducting secure business transactions.

Leadership and Culture

Culture is a fundamental tool that enables the managers to provide better leadership because the values and beliefs of the organisation are embedded in the hearts and minds of the employees. The proposed plan is to integrate the 15 culture elements into the organisational culture to guide the employees in performing different organisational tasks and duties (Freeman, 2010). The recommended elements include building a strong culture where the values and beliefs of the employees and customers are factored, the need to protect the natural environment by disposing waste products as per the environmental protection laws and regulations, encouraging the employees to dress formally, taking and obeying leaders, and to ensure that the code of ethics is embedded in the way of life of the employees.

The strategic roles of the leadership or the management include the planning function. The planning function will be done to enable the proposed company to prepare each activity such as identifying the physical location that will make the business operations feasible in the future or once the business organisation enters the market and which include strategy formulation. Other management functions include developing the right staffing plans, and executing the managerial controlling function by directing all organisational activities to implement the business strategies, mission and objectives (Freeman, 2010).

The controlling function includes establishing performance standards, establishing performance standards, comparing the performance standards to create better standards, and taking corrective actions to make sure that the strategies are in line in positioning of the organisation in the market.

Strategy Review, Evaluation, and Control

The practical methods that the company will use to evaluate the strategies include evaluating the use of resources to determine whether the organisation experienced problems with the strategies (Freeman, 2010). The strategic advantages will be examined in the context of the competitive advantages in the provision of computer hardware and software products and related services. Here, the success of the strategic management plan includes a careful identification and use of resources such as the web sites, virtual platforms, people skills, the right management methods to use to position the company in the market.

However, it will be necessary for the company managers to identify the right strategies and business practices to implement the strategic management plan effectively (Freeman, 2010). The recommended issues to consider include the consistency of the strengths of the organisation, the extent to which the strengths have grown, the internal weaknesses, existence of external and internal opportunities, existence of threats, and the vulnerability of the firm to other forces using a balanced scorecard.

Summary

The strategic management plan was drawn as a framework to guide the management in implementing the business strategy of selling new and refurbished computers, computer hardware and software and related products. However, the issues underlying the successful implementation of the strategy include a comprehensive review and understating of the guiding principles and concepts of strategic management such as formulating, implementing, and evaluating the strategies, use of intuition and analysis to investigate the business environment, and ensuring competitive advantage by the strategist.

The vision and mission statements form the foundation to formulate short and long terms objectives and strategies. However, a successful strategy factors the assessment of the internal and external environment by assessing the opportunities weaknesses, threats, and weaknesses to formulate strategies to address the issues arising thereof such as policy formulation. Some of the models to use to compete in the global market include evaluating the legal and politico environment, putting the strategies in action at the strategic, operational and functional levels.

The strategic management plan becomes effective when a strategy analysis consisting of forward and backward integration and assigning scores to evaluate and identify the best strategy to implement. Other issues to consider in the strategic management plan include operational issues, research and development, sources of finance and accounting issues, leadership and culture, and the strategic approaches of evaluating the success of the strategy.

Conclusion

In conclusion, it was established that it is possible to implement the strategic management plan using clear strategic management concepts. Here, several phases of the strategic management plan are crucial for the implementation process such as creating clear vision and mission statements, conducting internal and external assessments of the business environment to identify the threats, opportunities, weaknesses, and strengths of the plan, creating strategic plans to compete in the global environment by using e-commerce platforms and social media.

In addition, putting the strategies in action, analyzing the strategies by weighted means, implementing operational issues, conducting research and development and factoring financial issues based on effective leadership and culture provides an effective strategy to implement the strategic management plan.

References

David, F. R. (2007). Strategic management: Concepts and cases. New York: Pearson Prentice Hall. Web.

Freeman, R. E. (2010). Strategic management: A stakeholder approach. London: Cambridge University Press. Web.

Hill, C., Jones, G., & Schilling, M. (2014). Strategic Management: Theory: An Integrated Approach. London: Cengage Learning. Web.

Hitt, M., Ireland, R. D., & Hoskisson, R. (2012). Strategic management cases: competitiveness and globalization. London: Cengage Learning. Web.

Swayne, L. E., Duncan, W. J., & Ginter, P. M. (2012). Strategic management of health care organizations. New York: John Wiley & Sons. Web.

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