BSS050-6 Strategic Management Assignment Sample
BSS050-6 Strategic Management Assignment Sample
Introduction
Background
“Lumi Digital Design Limited” is a multifaceted visualisation and marketing agency comprising multiple product offerings such as architectural and interior design, marketing and brand identity and motion graphics. Multidisciplinary team of creative along with specialised skilled workforces are included in this company to redesign marketing, architecture and interior attributes in physical world. Lumi Digital Designs Ltd offers detailed designing plans along with potential specification to deliver end-to-end products and present creative visions in the business process (LUMIDIGITALDESIGN, 2022). Introducing “LDT 459 series” and “LTD51 series” as technological advancement in business operationshas provided higher quality of images to develop new business models and show creativity in visualisation and marketing indices (LUMI, 2022). This has been effective for this company to avail success in development of innovative and contemporary designs and achieve “Good Design Award, 2022”. Observing the innovative business model of Lumi’s has contributed generation of outstanding products to targeted customers and develop unique design in marketing.
Problem Statement
Offering of innovative product ranges and creating awareness in business operations within both online and offline presences have created potential disruption towards continuation of current business model by Lumi. Secondly, absence of effective marketing strategies has also created negative consequences in management of internal and external factors in the business process of Lumi digital.
Strategies
Observing consequences in business operations, Lumi Digital Designs Limited has announced a strategic focus on a wide range of product offerings into the business process. This has positively influenced creation of awareness in business process and enhances the product marketing process into online and offline inferences. Integration of motion graphic and visualisation process, Lumi Digital Designs has introduced “Bou Bear product” by CGI approval to determine future development in the business process (LUMIDIGITALDESIGNS, 2022). Apart from this, this company is involved in capitalising recent graduates and introduce products by NDS signed to identify further opportunities for business to grow.
Strategic Management Analysis
PESTLE
Political
UK Government has committed to create competitive tax regime in G20 and reformed corporate tax system to make attractive business operations to international market which is already reduced by 23% (ASSETS, 2022). In UK, “Open Government Partnership (OGP)” has been followed at international platforms for corporations including creative marketing agencies to build new forms of collaboration and policy (ASSETS, 2019).
Economic
Monthly “Gross Domestic Product (GDP)” is estimated to have fallen by 0.5 in December 2022 followed by unrevised growth of 0.1% in November, 2022 (ONS, 2022).Largest upward contributions as well as influences to the consumer price inflation rate in UK increased by 9.2% in December 2022 and down from 9.3% in November (ONS, 2022).
Social
According to “DCMS Economic Estimates 2020”, creative and marketing agencies in UK contributed £ 115.9 billion to the economic factors which accounted for 5.9% of UK economic landscape (LORDSLIBRARY, 2021).Since 2019, over 2.1 million people in UK are employed in the creative industries sectors which will increase by 3% from 2018.
Technological
Imposition of digital technologies related to “Artificial Intelligence (AI)” and “3D designs” during on-going pandemic situations supported digital innovation in creative companies (POST, 2022).Digital technologies have potential and positive impacts on targeted audiences related to the creative industry in UK and improve accessibility as well.
Legal
“Cybersecurity Laws and Regulations England & Wales 2023” has amended to protect digital presences and impair operations related to denial of service attacks and phishing (ICLG, 2022).Adhering to “NIS Regulations 2018” came into force in 2018 in UK to improve cyber security approaches into companies providing crictail services (GOV, 2022).
Environment
Pre-existing inequalities in creative marketing and cultural sectors affect the ability of creative practitioners to use technology (POST, 2022).Cross-sector collaboration and development in R&D increases digital capabilities along with opportunities in the business operations of creative industries in UK.
Porter’s five forces
Supplier’s forces in organisations helps to adopt multiple techniques such as increasing prices, reducing qualities and reducing availability of products. Dutta (2022) stated that high bargaining power of suppliers increased competition in industrial domain and lower growth of profitability. On the other hand, weak bargaining power of suppliers can increase growth as well as profitability index for organisations. Likewise, “Lumi digital designs” has complied with full service creative marketing agency with a multidisciplinary team associated with special skills in marketing, designs and architecture (LUMI DIGITAL DESIGN, 2022). Beside this, Lumi digital offered architectural and interior design visuals for measurable positive impact on clients.As per views of Bamford (2022), disruption in supply chain management increased demands of clients and also accelerated bargaining power of suppliers followed by price increase. Higher bargaining power of suppliers in Lumi digital designs has negatively affected the annual context of profitability. In relation to this, forward integration of suppliers, it has been observed that due to global and domestic factors of price rises, the international supply chain of interior designers have been disrupted.
Bargaining power of customers [High]
Customers exerted pressure on business processes to achieve the best quality of products as well as services to competitive prices within after-sales services. According to Höse et al. (2022), introducing sustainability and technological superiority influenced recycling opportunities of resources and attracted customers towards business processes. Strong bargaining power increases competition into industry and effects on profitability aspects (Höse et al. 2022). On the other hand, lower bargaining power of customers involves decreasing competition among industries and growth potential increase of profitability. In UK, revenue of home decor segment amounted to £3.55 billion in 2023 and the market is expected to increase annually by 0.59% (STATISTA, 2023). Higher revenue growth in home decor and interior designing market in UK indicated the existence of a strong customer base towards this industrial domain. Apart from this, as per perspective of customers in UK, individuals have preferred positivity, fun and sustainable decorating in home which engage individuals towards emotive stories (Dowdy, 2020). It has been asserted that bargaining power of buyers or customers is comparatively higher in UK for Lumi digital designs which increase level of competition into the industrial domain.
Threat from substitute [Low]
Market becomes more challenging for introducing new as well as existing products when substitute services or products are easily available in the market. Madsen and Grønseth (2022) explained that increasing threats of substitutes indicated customers have multiple choices to use alternative products offered by affordable prices. For instance, Lumi digital design has a creative content and digital marketing team to capture the imagination of audiences by developing video production, animation and editing (LUMI DIGITAL DESIGN, 2022). By offering inclusive products creating awareness in the business process, experts of Lumi digital designs incorporated video presentations to launch “Agu&Iya” natural tribal skincare products. It has already been analysed that revenue in Beauty and personal care market amounted to £12.69 billion in 2023 and expected to grow by 0.04% (STATISTA, 2023). Higher revenue in this industrial domain of UK indicated engagement of customers towards personal care, beauty products and natural products. Meanwhile, launching of natural skincare products related to tribal influences targeted customers of Lumi digital designs and introduced its luxurious ethically sourced gift sets for the whole family (BEAUTYANDHAIRDRESSING, 2019). These skin care products are available individually in the naturally tribal skincare IYA as gift sets and exotic Nut Scrub gift sets within affordable prices. This brand has positively influenced targeted customers associated with this company and reduced threat of substitutes in matters of this particular skin care product.
Threat from new entrants [High]
Threat of new entrants refers to threat of new market players which influences higher product differentiation processes and attract more players into market when entry barriers are low and profitability. Khan et al. (2022) inferred that the threat of new entrants affected the business by certain challenges related to regulatory frameworks, and existing products or services. In matters of providing creative and marketing services into interior designing, “H&M” and “Next Plc” provides affordable, accessible and effective homeware along with interior shops in UK (TELEGRAPH, 2022). “Never Knowingly Undersold” slogan has been generated by “John Lewis & Partner” to offer quality and fair pricing. Additionally, introducing fashionable and sustainable homeware shops by “H&M” offer affordable linen bedding with starting price range from £2.99 to develop quick interiors refresh (Astill et al. 2022). Based on architectural and interior design visuals, Lumi digital designs faced potential difficulties in maintenance of affordable price and requirements of customers in UK. Therefore, the threat of new entrants into this service would be comparatively higher for this company which increases competitiveness in industrial domain.
Competitive Rivalry [High]
Competitive rivalry refers to the number of competitors giving strong competition to the organisation. Sidiq and Dewantara (2022) inferred that higher product differentiation and cost of switching for consumers creates potential pressure from rivals which affected growth potential and profitability of firms. Minute analysis of problem statements reveals looking for effective product offerings and creating awareness in products within online and offline presence are considered as potential concerns for Lumi digital. On the other hand, British architectural and interior designing visuals “Rose and Grey”has offers quirky accessories and beautiful contemporary furniture in online and offline inferences (Astill et al. 2022). In addition, “Dusk” another British homewares shop offers affordable bedding and textiles along with awareness in business to grow business further. Observing offerings of rival companies, it has been asserted that competition for Lumi is comparatively higher in UK market.
Capabilities over resources
Resource based value
“Resource Based Value” analysis refers to the strategic resources which is important for organisations to avail strong composition in a competitive market. Collins (2021) explained that “Resource based value” involves categorising resources into two parts tangible and intangible resources. Tangible resources are considered as an integral part of business in maintenance of availability of resources that can readily be seen, quantified and touched. As per views of Ying et al. (2019), main tangible resources of business are considered as cash. Application of this Resource Base value helps to determine existing product offerings of Lumi digital Designs Limited. Skilled and experienced labour forces worked collaboratively to integrate positive impacts in products or services including architectural and interior designs, marketing and motion graphics (LUMIDIGITALDESIGNS, 2022). This is effective for this company to determine customer needs and establish visual language of consumers to capture the imagination of audiences.
Incorporating this “Resource Based Value” analysis, it has been interpreted that intangible resources are quite difficult to see, quantify and access. According to Buonomo et al. (2020), intangible resources are included skills of employees, the reputation of firms and internal or external culture of business processes. Likewise, Lumi digital designs capitalises recent graduates and collaborate with them to provide inclusive training for individuals regarding ins and outs of CGI through potential paid and unpaid placements (LUMIDIGITALDESIGNS, 2022). This would positively impact on creating awareness of business and products within both offline and online presence. Further, focusing on launching naturally tribal skincare products of Agu&Iya by this company would also be effective to address opportunities for this business towards further growth.
Capabilities
Capabilities in organisation refer to the firm’s ability to manage, bundle and exploit resources in an effective manner which provides value and potential advantages over competitors. As observed by Hanaysha et al. (2020), a dynamic capability included in as firm’s ability when a firm is skilled at continually upgrading towards its business capabilities. Application of “Resource based value” defined another key concept of business capabilities that helps organisations to arise urgent actions that build on existing strategic resources. In terms of introducing capabilities, Lumi Digital Designs would offer affordable best interior home wares to shop online. It has positively impacted on creation of awareness in business along with products in online presence. Additionally, to increase methods of addressing clients for increasing business practices, this company would employ recent graduates to accelerate external marketing presences in matters of improving offline marketing.
VRIO
Resources are following:
Valuable: New Resources related to architecture and marketing visuals would be developed to improve value added customer services.
Rare: Using resources including intangible related to customer services would be unique.
Imitate: Resources and capabilities would be difficult which is imitated by other competitors.
Organisation: Effectively generated by Lumi to develop growth in future improvements.
Value Chain
Figure 5: Value chain Analysis
(Source: Inspired by Jones et al. 2019)
“Value Chain Analysis” refers to firm’s ability in value chain operations to determine opportunities for further growth potential in the business process. As observed by Jones et al. (2019), value chain analysis can create change within a business process to improve products and services offered for customers or clients. Application of this theoretical aspect indicated primary activities in value chain as operations, marketing and services. Based on primary activity related to operations, Lumi digital designs haveoffered architectural and interior design visuals to provide customers end-to-end products in matters of creative vision in the best possible light (LUMIDIGITALDESIGNS, 2022). Pushing towards boundaries, this company is involved in providing higher quality of images to help customers to win that pitch and attract customers towards new business models followed by creativity. In context of marketing, sales and services, this company offered inclusive video presentation, animation and editing to capture audience imaginations. These primary activities of this company are effective to explore ways in which the people imagine and interact with physical world.
SWOT
Figure 6: SWOT Analysis
(Source: Inspired by Benzaghta et al. 2021)
Strength – Strong multidisciplinary team of creative’s with specialist workforces included in marketing, designing and architecture.Offers a wide range of product offerings including architectural and interior designs, marketing and motion graphics.
Weakness – Price of interior home decorating items are comparatively higher which might limit to the targeted audiences.Limitation in product offering of business and creating awareness in products or services are key areas of concerns for Lumi.
Opportunity – Incorporating marketing and strategy based operations to address best growth in business.Capitalise with recent graduates to offer effective training and development practices to create awareness in product and increase brand identity.
Threat – Intense competitions from rival home and interior designing companies like “John Lewis & Partners”,“Dunelm” and “Dusk”.Competition laws and lack of larger scale development that leads to mergers associated with many convenience stores.
Strategic approach analysis
Strategic approach analysis refers to an evaluation of organisational working environment including internal and external effectively. As per views of Jones et al. (2019), analysing strategic approach is most likely to determine operational areas of organisation and helps to fulfil goals and objectives as per organisational settings. Based on external analysis (PESTLE), it has been observed that continuous support from UK government and amended of “Open Government Partnership (OGP)” would effective for Lumi to develop international platform towards business expansion. Integrated technological advancement like 3D designing and AI in creative companies would also influences of business operations and current accessibility in business aspects. Beside this, evaluation of Poster’s Five Forces revealed lower power of substitute in UK towards creative marketing agency. It would positively impacted on business operations of Lumi into international market. Apart from this, internal and external capabilities have been identified by SWOT analysis (Internal factor analysis) within business process of Lumi digital designs Ltd. It helps Lumi to determine strength in presence of multidisciplinary creative team along with specialist workforces to deigning and marketing the products or services. It provides immense opportunity to develop diverse integrated strategic marketing practices towards growth in future business operations. However, intensive competitions have been forced from rival companies like Dunelm and Dukes within UK market which resulted on increasing business operational disruption and organisational constraints.
Conclusion
This discussion concluded detailed information regarding potential difficulties faced by Lumi digital designs during offering of innovative product ranges and creating awareness in business operations. This issue created potential disruption in management of presence into both offline and online platforms. Apart from this, ineffective marketing strategies hindered management of internal as well as external factors of Lumi digital designs while developing unique designs. Attractiveness of this company has been analysed by interpreting primary activities into value chains related to offering a wide range of products into architecture, designs and marketing. Critical analysis of internal factors by SWOT analysis indicated weakness into limitation in price management activities for targeted audiences. Potential threats came from rival and interior designers companies for Lumi which created negative consequences into business operations. Integration of customer centric marketing strategies by Lumi would be effective decision making to address opportunities for business to grow.
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