Executive Summary
Gulf Falcon Air-conditioning Systems Fixing (G.F.A.S.F.) is a small company, which specializes in package system split & Sheller systems. G.F.A.S.F Started as a small company in 2006 with its offices situated in Dubai. G.F.A.S.F has the capability to implement its strategies and also conduct a careful market analysis of its produce. It also partakes routine research of its catchments areas which has worked positively to enable it to integrate effective technologies and at the same time minimizing its operational costs.
G.F.A.S.F. undertakes the manufacturing of chilled water from a centralized place to all customers. G.F.A.S.F. has professional who addresses different needs of the clients. G.F.A.S.F works as a team to pull in the same direction.
District cooling provides chilled water piped from a cooling plant to residential houses, commercial and industries (Coyles & Gokey 2002).
Introduction
Global economy
The world has become a competitive landscape and for companies to succeed they need to have a competitive edge. Therefore G.F.A.S.F will seek to develop and implement strategies that its competitors are unable to imitate in order to maintain above-average returns in its financial portfolio. The 21st century provides companies with an impetus to stay ahead of the park. A rapid change in the world markets where conventional sources of competitive advantage are losing effectiveness has compelled enormous investments in order to compete globally. The products have less sound pollution. Similarly, increased economic interdependence among countries where there are goods flowing with services unlimitedly, financial capital and knowledge across borders has led to a high increase in performance, quality, high productivity, production introduction time and operational efficiency.
This has enhanced the company’s strategic flexibility where it is in a position to respond to various market demands accompanied with opportunities in a competitive environment.
Mission of Gulf Falcon Air-conditioning Systems Fixing
We deliver thermal energy to customers as an effective cooling solution. In doing so we:
Team satisfaction: the management and employees are committed to working as a team in order to achieve profitability in the company as well as gratification.
Customer satisfaction: G.F.A.S.F. is an established company that seeks to meet customers demand, customer relations as well as competitive pricing.
Community satisfaction: G.F.A.S.F. will provide jobs in a safe and secure environment and also take measures in ensuring its corporate responsibilities are met
Highest quality: G.F.A.S.F. will ensure that its products meet high market standards and customer confidence by employing the leading technology, as well as flexible customization of products to meet specific customer standards.
Improve the financial success to our shareholders (Gale & Chapman 1994).
Vision statement of G.F.A.S.F
The vision of G.F.A.S.F is a fore front provider of environmental –friendly and creative cooling systems and solutions.
Marketing Objective
Firms acquire competitive advantage over their rivals in many ways. A nice strategy will bring in competitive return over rivals. For a firm to enjoy competitive advantage, several factors must be present. This includes presence of substitutes for the core competence, it should be hard for any other company or organization to duplicate or copy and implement that kind of strategy. Also, the rate of competence resulting from the environment matters a lot (Mockler 2003).
Internal Analysis
is core to most organizations which are successful. Internal analysis is the process carried within a company so as to determine the rate of return of the factors within the company. In internal analysis, it is important that the financial position of the firm be understood. Furthermore, performing as well as those that do not perform well within the firm have to be identified such that well performing departments have to receive more support and for poorly performing departments, necessary actions have to be taken to bring its performance up. In internal analysis, outcome analysis must also be carried out so as to determine how to redistribute the firm’s share of resources and capabilities. Global-mind setting is the ability of the organization to detect environmental threats and environmental opportunities, setting targets higher than the resources available.
G.F.A.S.F as a company has set strategies high enough to challenge its resources, its capability and it has been mainly working on global objectives other than local ones that is to say, it has been engaging global-mind setting. Primary activities in value-chain analysis include creation of the commodity physically, selling and distributing it and then offering after-sales service. G.F.A.S.F as a small company which specialize in package system and Sheller system carries out most of these primary activities hence it engages both internal analysis and value-chain analysis. In terms of value-creating potential for the primary activities, there is procurement so as to ensure efficient delivery of inputs, development of human resources and its leaders along with technological development so as to ensure activities are completed in time in manufacturing and distribution of products. G.F.A.S.F has so far been doing well as reported in all the activities reported above where upon, it is among the topmost companies in offering efficient and quality packaging system. It has a well equipped system for management of human resources and is headed by professionals who have the best qualifications and a vast experience (Van, Hans, Hoyer & Inman 1996). See appendix 2.
Strategies
Strategies are the means or plans put in place by an organization to enable it achieve its objectives. Strategic management refers to administration intended to fit exactly into the set objectives of the firm.
G.F.A.S.F applies various types of strategies in reaching its objectives. They include global strategies and multi-domestic strategies. Under a global strategy G.F.A.S.F Standardizes its products in all markets it serves and they are well prepared to meet the needs of the target markets. The various Strategic Trade units rely on each other to operate optimally and economies accompanied with scale are highly used as a means of reducing production costs while at the same time increasing sales. Under multi-domestic strategy, the small business units which are opened up by the main branch have the right to make specific strategic decisions.
Strategic framework
G.F.A.S.F as a company enjoys various strategic benefits. For instance, it commands a large market size. Its products have come to control the market for quite sometime.
Second of its strategies is to continue holding a wide market share and this comes with allocation of more resources in advertising and maintaining quality output.
Its economies of scale is also another strategic benefit that the company enjoys such that due to its large size, it incurs less costs in production and its overall output brings in more profit.
However, it is also notable that the firm enjoys location advantages. This reduces expenses that could be incurred on transportation of raw materials from far places. It also saves on the labor costs in that instead of fetching employees from certain specific areas to come and work elsewhere, the employees are drawn from the region where the company branch is located.
Returns from investment is also another strategic factor contributing to growth of the firm. Long term investments are particularly essential for a company’s future success as returns on these investments bring about internal and external growth.
Cooperate strategy is a plan in which a number of firms agree to work together so as to attain a specific objective. In case there are more than two firms involved, then it is called network alliance (Peltier, Schibrowsky & Davis 1998).
G.F.A.S.F. Pestle and Forces Analysis
Political
Political stability is going to be a key factor if G.F.A.S.F. is to succeed in its business venture in the United Arab Emirates it should be noted that since its formation the UAE has relatively enjoyed political stability. It can be concluded that the competitive environment of the UAE and its limited regulation on trade will go along way in ensuring that G.F.A.S.F conducts its business in a desirable environment.
Economic
Economic development in the UAE began slightly after 1970 after the formation of the federation this coincided with the massive increase in oil production which gave the country a sound economic footing (Woods 2001).
Social
Social aspects include a society’s norms, attitudes as well as cultural values. The UAE government has spent huge amounts of resources to ensure the country is transformed into a modern environment.
Technological
Through limited regulation, the government of UAE has facilitated the establishment of numerous packaging based companies. This has had the effect of encouraging foreign direct investment in packaging related industries.
Five forces model
The five forces model is a deeper market analysis that takes into account the threat of substitute products in the market, new entrants, bargaining powers clients as well as rivalry among competitors
Entry barriers
New entrants into a market can pose as a challenge to existing players. In light of this G.F.A.S.F can only pursue strategic alliances with the already established players.’ in order to gain a market share from the current competitors. This will also ensure that the company keeps its inventory costs at a minimum hence profitability. As a government policy, 51% of foreign companies must have local control, this could slow down G.F.A.S.F entry into the market (Sutton 2007).
Buyer power
Though, the prevailing economic standards in the UAE are favorable and have led to a high purchasing power in the citizenry, G.F.A.S.F marketing strategy of dealing directly with the customers and avoiding the middle men, will ensure that our prices are competitive and affordable. Through the minimization of cost, it will be possible to sell our products at a lower price.
Supplier power
Supplier power is never as intense in the packaging industry. G.F.A.S.F has always adopted a vertical integration mode of operation in regard to the control and distribution of inputs. G.F.A.S.F will find it necessary to undertake activities normally undertaken by suppliers and distributors in a bid to minimize on cost. This is called full vertical integration (Chaudhuri & Holbrook 2001).
Substitutes
Substitute products are of little threat in the information age as far as the packaging industry is concerned.
Comparison with other competitors
Though there isn’t a strong government backed company in the UAE, rivalry and competition will come from other foreign firms. G.F.A.S.F success in the UAE will largely depend on how it partners with established distribution channels in the country to access the market.
See appendix 1.
Market analysis (analysis of SWOT)
In achieving its objectives and a niche in Dubai, “G.F.A.S.F. will have to formulate and consider its threats, strength, opportunities and weaknesses (SWOT) a comprehensive analysis of the above will form the basis of establishing a more efficient strategic management plan” (Podolny 2001,p.86). Strength will alight what the organization is good at and can perfect this may include a professional work team and adequate and up to date facilities to make their work effective weaknesses may highlight what the organization is not capable of achieving as well as its inadequacy. Opportunities may indicate what the organization might seize to its advantage so that it can accomplish its objectives; this may include taking advantage of favorable government’s grants as well as tax exemptions to bolster its business strategies. Threats are environmental factors that may impact negatively on the venture in the Middle East. This may include negative legislation agenda which may impact on resources.
Strengths
This may be termed as capabilities and internal resources that give the company a competitive edge. G.F.A.S.F core strengths that will be beneficial to it in its venture in the Middle East include Dealing directly with the customers will ensure that the company gets direct feed back on the products. This will augur well with the company’s strategy of formulating solutions to tackle any customer needs.
Weakness
In light of its strengths the company will also need to formulate strategies to counter its weakness to effectively balance in the market. G.F.A.S.F weakness can be leveled to single sourcing, an over reliance on the corporate market. To deal with this the company will need to diversify its markets within the Middle East to cater for individual buyers.
Opportunities
G.F.A.S.F will need to take advantage of available opportunities in order to advance its business agenda. The industry is still exponentially growing hence more opportunities in terms of new markets and customers this enables the company to exploit opportunities to expand its business across the Middle East as well as launch new products in the market.
Threats
GFASF will have to contend with a number of threats in its business operations. This includes the ever changing technology. Technology can only get better and for G.F.A.S.F to stay afloat it must change with the technology or even stay ahead of its competitors. The global economy that will see a saturation of other competitors will also play an important role in shaping the financial aspects of industry players. G.F.A.S.F will also need to stay abreast with emerging strategies from its competitors with a bid on improving on its products. New players in the market might bring new products thus complicating its access to distribution channels when substitute products are introduced which may be priced lower.
Critical success factors
The concept of dealing with customers on a one on one basis is paramount if G.F.A.S.F is to achieve its strategy and increase its profit margins. This will be important in cutting down cost associated with middle men as well as ensuring that customers get better quality products and more powerful systems. This will enhance customer relations as well as customer loyalty making the company establish a wider market niche. G.F.A.S.F must be aware of its competitors strategy to enable it come up with counter strategies and ensure that investments and resources are appropriately allocated to enable G.F.A.S.F. achieve its market objectives. Having achieved a good reputation in the US market, G.F.A.S.F will be counting on this reputation to enhance its market share in the UAE. Customer satisfaction in its new markets will be of great significance and therefore customer awareness and customer surveys will be important to ensure that it creates a positive image of itself. Market timing and planning will also be critical in regards to the launching of new products as well as mapping counter strategies in the ever changing and competitive technology market
Strategic Plan for 2009-2011
Strategic Plan Based on SWOT analysis
GFASF as a packaging company is experiencing scarcity in its sales. The following plan is expected to help it come up.
The following is a review of weaknesses, threats and opportunities that the company could be encountering (Reinartz & Kumar 2002).
Vision
G.F.A.S.F will operate from the current Dubai. It intends to acquire double its current sales. Also be providing added-value services to its customers throughout the established and potential market segments. The G.F.A.S.F services are expected to offer a range of advantages over competitors’ offerings.
Business Objectives
Long term business objectives are as below,
- To regain full market control.
- To become the leading company in packaging system in business.
Key Strategies
- Maximize its potential in selling products globally.
- Stabilizing products selling price.
- Improve on customer service and attention to customer needs.
- Pursue strategic alliances with industry participants.
Major Goals
- Triple company sales by 2011.
- Double current profit margin.
- Attain a 50% market control by 2011.
Strategic Action Items
- Improved infrastructure.
- Implementation of financial plan within six months.
- Initiate strategic alliances within and without the industry.
- Complete the merging process with AAPL within six months.
Tabular representation of finances and resources for the merger
Conclusion
Technology is ever changing, the global economy has ended up shrinking into a global village; opportunities belong to those who can effectively analyze the market environment by using their strength to spot potential opportunities. G.F.A.S.F strategy in the UAE is one example. Great emphasis should also be placed in marketing, some analysis should be undertaken to make it easy for effective feedback from the customers reactions. Generally effective planning and strategy is enough to propel businesses towards success irregardless of the market dynamics.
References
Chaudhuri, A and Holbrook M 2001, “The Chain of Effects from Brand Trust and Brand Affect to Brand Performance: The Role of Brand Loyalty.” Journal of Marketing vol.6 no.65 p 81-93
Coyles, S and Gokey, T C 2002, “Customer maintenance is not enough” The McKinsey Quarterly 2.
Gale, BT and Chapman, RW 1994, Managing Customer Value: Creating Quality and Service That Customers Can See, Free Press, New York.
Mockler, R 2003, advanced strategic analysis, Haworth Press, Haworth.
Peltier, J., Schibrowsky, J and Davis, J. 1998, “Using Attitudinal and Descriptive Data Information: Understanding Interactive Buyer-Seller Relationships” Journal of Interactive Marketing, vol.12.3, no.12.3, pp. 32-45.
Podolny, J. 2001, Strategic management system. John Wiley, New Jersey.
Reinartz, W. and Kumar, V. 2002, “The Mismanagement of Consumers Loyalty” Harvard Journal of Business Review, vol.80, no.80, pp.86-97
Sutton, R, 2007,.Modern Strategic Management for firms: Evidences dealing with Management, Harvard trade Press, Harvard.
Van Collins, Hans C. M., Hoyer Wayne D., and Inman Jeffrey, J 1996, “Why Switch? Product Category- Level Reasons for True Variety-Seeking Behaviour.” Journal of Marketing Research, vol. 33, pp. 281-292.
Woods, A. 2001, Technical strategic organization. K. Page Publishers, London.
Appendix 1
Indicate the comparison between our company and competitors
Appendix 2
Internal & external marketing and the difference between them
