This is solution of Icon college small business enterprise assignment, related to HND business development course.
SolutionsPT is a company which provides solution in the Industrial IT and Automation space in North West UK. They provide several solutions pertaining to softwares and other managed services in the United Kingdom and in Ireland. It is a company which provides a varied level of IT services. It is company which has around 70 employees who are skilled professions in the information technology domain.
It provides various products and services in the Hardware, Software and the Advanced Manufacturing services domain. It provides solutions that caters to new production innovation, improvement in the quality domains, extending ERP solutions and providing sustainability solutions. The company also have several missions and values that are more in accordance to the benefits of the employees and therefore, it has a very high rate of employee satisfactions which had ultimately resulted in its sustainable growth even during turbulent times
HND business Unit 3 Organizations Behaviour Assignment
Cloudreach is a small company which is based out of London. It has a staff strength of around 55 professionals. The company was founded in 2009 and it facilitates several businesses like football clubs and hotels in their IT operations. Liverpool football club and the Kempinski Hotel group are the organizations it works for and help them in migrating their systems information as well as data to cloud applications by Amazon Web and Google. It is an organization which stands more for its values like employee satisfaction rather than a just work. It was a company which was started by Pontus Noren and James Monico with high company values and an objective to make the company a better place to work on similar grounds like Google.
The company deals in several aspects of providing IT services like Consultancy, Migration Services, Application Development and Managed Services. It provides a varied level of IT solutions with well-equipped IT professionals that have variance in the salaries but not on the Job title. The company does not propagate the concept of Title or hierarchies
LO1: Performance Measure
Companies pay a lot of importance in analyzing the Performance Matrices both for the growth of the company as well as the employees. The efficiency of the company can best be visualized as well as measured by doing a Performance Analysis of the company. SolutionsPT Ltd. measures its performance on the following 3 fronts:
- Organizational Performance - SolutionsPT Ltd tracks its performance on the organization front using the Balance sheet and the Profit and Loss Statements on a quarterly basis. This is mainly preceded by the quarterly goals and the objectives (Tetteh, 2001).
- Setting targets to tap opportunity - SolutionsPT Ltd as an organization is highly competitive and had set in several targets pertaining to its growth strategy. There are several opportunities that can be tapped in the competitive market. It also sets several targets in order to capitalize the available opportunities.
- Measuring internal and external performances – Based on the above 2 parameters the cumulative internal and external performances can be measured.
Some of the other performance measures or indicators used by small and medium enterprises are the degree of the customers’ satisfaction, the increase in the sales, the growth of the positive image of the enterprise in the market, the gain in competitive advantage over the other companies in the same industry and increase in the profit of the organization.
- A well-defined service and product portfolio for its customers
- High focus on innovation
- Strong relationship with the partners and the customers
- Follows the Go Green concept of business.
- High Pressure on the Pricing front from the competitors as well as the major players
- Lack of strategic plans for growth and development for the company
- Limited manpower in spite of being a 28 years old company.
- Entrance into New Technologies like Cloud and several other diversified solutions in the IT Industry.
- Opportunity in the European market and global market in long run.
- Unpredictable Global Economy that might affect the smaller players in the IT Industry.
- Increasing competition both from the SMEs as well as the alternative solutions that is provided by SolutionsPT Ltd.
- Threats from the bigger players.
The PEST Analysis for SolutionsPT Ltd is as follows:
Political- SolutionsPT Ltd works in a highly stable environment on the political front and the regulations in the UK are highly favorable for the growth and development of the SMEs. On the Political Front the risk is Low.
Economic– Being in the IT industry, the economic business environment is highly volatile and poses a threat on the revenues as well as changes in the currency rates. Moreover, the economy of UK is also a very fragile with several treats of attrition and volatile currency. Therefore the Economic threat is high.
Social – On the Social front, SolutionsPT Ltd works in a highly friendly social environment with no issues pertaining to drastic variance in cultures or language. Most of the employees are of English origin. Also the support from the society is also high owing to the Go Green concept it propagates. The Social Threat is Low.
Technology – On the Technology front, SolutionsPT Ltd works in a highly competitive environment with the regular advent of changing technology. Also the technology is changing at a fast pace which poses greater focus on continuous R&D as well as regular Updation with the changing environment. The threat here is high.
Comparison to Competitors
SolutionsPT Ltd has a very small workforce as compared to its main competitors like TPP in the SME segment. Also, it lags in providing the complete workplace benefits and fun to its employees like Cloudreach. However, it had maintained a steady growth rate of around 7% YOY owing to the vast amount of product variance that it provides to its customers compared to its competitors. The organization doesn’t hold a large share in the market of the industry in which it operates as compared to its large competitors. The benefits provided to the employees of SolutionsPT are also not very good in comparison to the competitors in the same industry. But some of the business strategy of the organization allows the customers to get satisfied in a more efficient and effective manner as comparison to its competitors. This also allows the organization to provide timely bonuses and some small benefits to its employees which allows the management of the organization to keep the employees motivated and determined. The appraisal system in the organization also allows the employees with good performance to be appraised and rewarded by some hike in their financial income from the organization. This allows the organization to keep a fair balance between the satisfaction of the customers and employees. This allows the organization to perform considerably against some of the big competitors in the same industry. This comparison reveals the standing of the SolutionsPT Ltd organization as compared to the other organizations operating in the same industry.
LO2: Recommendations for overcoming the Weaknesses
SMEs generally faces several challenges on the business operations front and the same needs to be addressed with utmost perfection in order to sustain growth and compete against the rivals. SolutionsPT Ltd also a company had been taking several strides in order to overcome its weakness and capitalize on its strengths and leverage the opportunities (Robson, 2000).
Following the ways by which SolutionsPT Ltd can try to overcome its weaknesses:
- High Pressure on the Pricing front - SolutionsPT Ltd receives several pricing pressure from the bigger players in the market. Therefore, in order to counter the same it should look out for options to optimize its operational costs thereby reducing costs and have more operational profit as price rise is not an option.
- Lack of strategic plans for growth and development - SolutionsPT Ltd lacks strategic planning as part of its corporate mission which had led to its stagnant growth. Therefore, the organization should look out for options to counter the same by having a better management with a strategic outlook. This would help in creating sustainable growth with realistic goals.
- Limited manpower – Being a company which had been established in 1985, there had been a considerable low level of growth on the manpower front. Being a company for nearly 30 years now, the advent of the growth has been considerably slow. It should look out for options that would be more of the growth on the manpower front. It should diversify in order to get more employees and also seek more business opportunities.
Expansion strategies are the backbone for the companies and they should seek SolutionsPT Ltd must look out for expansion strategies in the European market and later on a global front. It should take up the following steps in order to attain the same:
- Develop Strategic Goals - SolutionsPT Ltd needs to have a strong management force to drive the growth plans with a strategic approach. It should have regular performance matrices to validate the performances and growth objective. Moreover, the strategic plans should involve the flexible and optimistic in nature in order to attain organizational goals.
- Rapid Actions on the Growth Front - SolutionsPT Ltd should look out for options which should be focused on rapid action plans pertaining to the growth strategy.
- Growth oriented team- Recruit team members who are more focused on growth and are competitive.
- Diversification - SolutionsPT Ltd should also look out for options of diversification on the product or service offerings which it has on the portfolio front. Diversification will enable growth along with more business options.
- Optimize Resources – As part of the expansion plan it should also look out for recruiting the best in industry resources as well as capitalize on the plan for having the optimization done on the operation front in order to have more efficiency and increased profits.
- Outsourcing – Small organizations like SolutionsPT Ltd should also look out for outsourcing options in order to deliver the best solutions at affordable rates. Moreover, it should not seek diversification at the cost of quality.
- Partnerships - Moreover SolutionsPT Ltd could also look effective partnerships with the various vendors that would not only enable business processes but also help in their expansion strategy and reach out to more prospective clients (Raymond, 2008).
- Marketing Plan- Marketing plays a very essential role in the expansion strategy for any company. SolutionsPT Ltd should also look for innovative marketing plans to increase its market visibility as well as attract more and more customers. It should also have proper marketing budgets in place from the annual budgets in order to ensure that no channels of marketing the untapped to reach out to the target segments. It should also look out for a proper Marketing Research plan to devise marketing plans in accordance to the findings of the research.
- External growth strategies
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The external growth strategies for one of the small and medium enterprises allows the organization to look for a number of opportunities in the market external to the current organization. These external opportunities allow the small and medium organizations to grow both in horizontal and vertical diversification.
In this type of growth strategies, two organized are combined to be led by a common owner. These organizations are generally of the similar value, which defines the lateral mergers. The upstream and downstream mergers define the processes in which the organizations of different values are merged together into a single unit.
This growth strategy allows one organization to absorb all or most of the other organizations. This strategy again can be divided into horizontal and vertical integrations.
Thus, by implementing the aforesaid Expansion plan, SolutionsPT Ltd can look out for several ways to streamline its processes for a profitable business.
LO3: Assessment of Existing Business Objectives and Plans
The business objectives and goals of the SolutionsPT Ltd can be defined according to the S.M.A.R.T criteria, which describes the goals and objectives in terms of several factors.
To provide the best quality services and IT solutions in the same industry.
To attain 70% increase in the customer satisfaction and 80 % increase in the sales over the next 5 years.
Identify, analyze and satisfy all the needs of the customers in an efficient and effective manner.
Providing the perfect environment for the employees to learn and grow along with satisfying the needs of the customers.
To become one of the best IT solutions providers in the same industry in the next 5 years.
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Assessment of Business Objective
Though SolutionsPT Ltd provides varied levels of solution offering, however, it had not been able to be a market leader in this segment. This is mainly because it had not been able to gain expertise in any of these service or product offerings. Moreover, it had very less focus on the R&D and without innovation in the IT industry, development is not possible.
SolutionsPT Ltd also aims in providing customer service, but over the years it had not been able to showcase the customer satisfaction levels and they have switched to its competitors who provides better solutions at more affordable rates. Moreover, its customer satisfaction has also not been up to the mark which had effected customer retention policies.
However, on the Employee Satisfaction front, it has high credibility and takes a very good care for the development of the employees. This is the reason it has a very less attrition rate and highly satisfied employees. It also provides several benefits on the performance levels as well as for personal development through trainings. It had also scored high in the employee satisfaction survey that aided the confidence of the firm in its employees.
Action Plan for Implementing Changes
In order to grow, every organization must consider the optimum action in order to implement the changes that would bring about the development for the organization. SolutionsPT Ltd should also focus in identifying the above mentioned assessment of the Business and implement action plans to bring about the changes (Davidavi?ien?, 2008). Following are the Actions that needs to be taken in order to have a strategic stride towards development:
Week 1: Consult and establish a team to find out the various fit gaps that are existent in the organization based on the business objectives and the performance measures.
Week 2: Devise the findings as well as find out ways in order to modify the existing Business Objectives and Strategic Plans
Week 3: Identify the objectives as well as the resources that needs to be enabled in order to attain the growth objectives.
Week 4-20: Implement the strategies that are aimed for business development and organizational structure.
Week 21: Analyze and evaluate the business changes based on the organizational goals and objectives. This can be done by doing a SWOT analysis.
Week 22: Make appropriate revisions to the tasks based on business analysis and plan for an implementation action. Document the process changes and the best practices based on the assessment and the implementation procedure.
Also at every step of the Action Plan, it is highly essential that proper communication is made to all the stakeholders including the employees for the changes that would be incorporated as part of the developmental plans.
LO4: Examine the Impact of Change Management
Change Management is an important for all the organizations which seek growth through continuous improvements and innovation. SMEs needs to pay lots of heed on the very essence of change management in order to bring about the sustain growth in a highly competitive environment. As part of the Change management process, SolutionsPT Ltd should take the following steps in order to remain competitive as well as sustain growth:
- Build Change Management Framework – As part of the Business strategy, SolutionsPT Ltd must focus on building a structure that is more focused on the Change Management and would be rendered to any environmental changes pertaining to its sustainability. Moreover as part of the Framework all parameters responsible for the growth strategy must be listed down and appropriate performance measures needs to be factored that comply with the changes.
- Documentation of the Changes – Changes that needs to be incorporated needs to be properly documented and analyzed in order to have a proper channel of communication to the various entities that would be involved. Moreover, this would ensure a visible and alterative medium for any modifications that might be required for the change management process. This would also ensure in keeping a track record of all the plans and procedures that might be an essential part of the entire process.
- Communicate the Business Objective and Goals – As part of the change management strategy, proper and transparent communication needs to be provided to the various stakeholders. This will ensure better adaptability of the employees as well as the various stakeholders to the changes and would help them adjust to the new changes (Geppert, 2003). Communication needs to be done using several mediums like verbal, written or even pictorial. This would help the stakeholders to be updated with the progress of the change management process happening in the organization as well as ensure that there is minimal resistance from them that might obstruct the business objective.
- Allocation of resources – As part of the change management process, proper resource allocation and budgeting needs to be done in order to seek visible effects. Resource allocation needs to be done on various fronts like human resource, infrastructure, finances, etc. All these needs to be superseded with proper training and knowledge transfer sessions.
- Effective Management – The change management process cannot be attained with utmost success until there is an advent of strong and capable force of Management professionals to drive the entire process. Effective and efficient leadership skills are inevitable part of the process and needs to be utilized with perfection at every step of the change management process. Proper Training as well as performance tracking matrices needs to kept in place to ensure that the objectives and goals are met with proper timelines.
- Regular Performance Tracking- As part of the change management process, regular performance check is required in order to track the various progress that are a part of the change management process. This needs to be considered as one of the critical processes to leverage the essential components involved in the Change management process. The various parameters, weightages and timelines needs to be part of the tracking process and regular checks needs to be done by the managers to evaluate the progress. Based on the progress report, appropriate modifications needs to be made in order to maintain compliance to the business objective.
- Thus, these change management steps would help in ensuring a holistic approach of sustainable growth in the market of SolutionsPT Ltd’s operations and also exploit the untapped markets that would be part of the expansion strategy.