BSS063-6 Management Practice Assignment Sample
BSS063-6 Management Practice Assignment Sample
1.0 Introduction
This report has the effective strategic management theories of the International Bicycle Firm, additionally, strategic marketing, finance, HRM theory, leadership theory and an applicable recommendation are included. Those strategies and market analysis apply to every business aspect and they will help any organisation to understand its current market environment, opportunities and threats. Furthermore, finance is an important part of any business, in this report, the finance plans taken by the international bicycle firm are described in the following segments. The HRM and leadership theories have a role in improving internal aspects of an organisation, and the applicable HRM and leadership strategies for the bicycle firm are explained properly in the report.
2.0 Strategic Management
2.1 SWOT analysis
Strengths
The international bicycle firm is introducing a carbon fibre cycle which is stronger and lighter than metal. This new addition to their strategy would help them to create a new customer base that prefers bicycles made with sustainable materials. Since, in the last few years, it has been noticed that people are becoming more cautious regarding reducing climatic hazards and pollution (Naveed, and Whitford 2019). The 3D printing technology of the bicycle firm would also help them to reduce the overall costs by cutting the expenses on distribution and manufacturing.
Weaknesses
Despite the introduction of new carbon fibre cycles, the International bicycle company lacks behind in the inventory management process. Since the firm has a lot more scope to improve its inventory management. Furthermore, the company had integrated technology in the back-end process which is not the case for the front-end. As with any product, it is always found difficult to create demand without the help of marketing (Krizanova et al. 2019). The firm needs to up its game in marketing and advertising to create awareness about the new product and its benefits.
Opportunities
As the concern over climatic hazards is rising with each passing day, people are preferring mobility solutions that would not harm the environment. Therefore, many people around the globe started to prefer bicycles over motorcycles and cars (Shields 2019). The brand can encash its carbon fibre model to gain the interest of people who are preferring pollution-free mobility. Moreover, the 3D printing technology would help the brand in making customized bicycles according to the customer’s needs.
Threats
The major drawback for the brand is the cost factor of its products. Currently, the prices of carbon fibre bicycles are too high compared to normal bicycles made with metal (Kasmer and Hassan). Besides that, the market trend is very unpredictable and changes seasonally. The demand for bicycles always gets reduced in the summer season around the globe. Moreover, competition with other similar brands is also a threat to the bicycle firm.
2.2 PEST analysis
Political
Many people around the globe ride bicycles on the roads and the number has doubled throughout the decade. During the Covid pandemic, people were preferring bicycle rides as there was no public transport available to curb the virus contamination (Pase 2020). Therefore, the demand for bicycles increased by many folds. Other than that, the governments of many countries promoted bicycle rides to reduce the environmental effect due to their carbon-free mobility.
Economic
One of the major advantages of bicycle rides is that it is a low-cost mobility solution. The other methods of transportation require more expenses as ticket fees or fuel prices but on the other hand, a bicycle ride requires just a one-time investment to buy the product and very less expenses on maintenance. Since, during the Covid crisis many people around the globe faced the heat of unemployment, which resulted in them finding it difficult to afford other transportation methods.
Social
The bicycle has demand in all sections of society from economically weaker to wealthier individuals and also all age groups from children to superannuates. Therefore, the brand can serve every section of society with its different bicycle models and customisation of models as per the preferences of the customer (McKenzie, 2020). Moreover, the 3D printing technology would also help the brand in reducing the cost of carbon fibre bicycles as compared to high-end metal-made bicycles.
Technological
The advancement in technology is another aspect which would help the firm to build more innovative and sustainable models. Integrating technologies like 3D printing would result in a reduction in production costs as the 3d printing machine requires less space in warehouses (Nickels, 2019). Other than that, the brand had started to incorporate some of the new features into bicycles including GPS commuters, electronic groupsets and quick-release skewers which would allow the rider to change the wheel more quickly than before.
2.3 Porter’s Five Forces
Competition in the Industry
Despite having some advantages over technology and the supply chain, the brand has plenty of competitors in the market. The other contemporaries are eating into the market share of the brand by providing similar products at a competitive price (Su et al. 2021). The introduction of carbon fibre bicycles by the firm is no longer a unique product for the people as other brands also started to make similar products after realising the demand. Although, due to the larger customer base and growing demand for the bicycles the brand would not face much threat due to the competition. As a result, the threat regarding this force is medium.
Potential new entrants
There is a lesser threat from the new entrants as the brand already holds a reputation over other brands which would not be an advantage for the new entrants. People always prefer established brands due to the familiarity of their products (Zhang and He, 2020). Moreover, their unique bicycle models have their own unique identity which attracts the consumer more than other brands. Therefore, the threat associated with new entrants is low.
Power of supplier
The whole supply chain all over the world got disrupted during the Covid-19 crisis due to the several phases of lockdown. The brand faced difficulties in acquiring raw materials and other equipment from different regions of the world due to transportation hazards (Li et al. 2020). Despite having a hold on a broader and more reliable supplier base the brand also faced a supply crisis. Although, the brand still could not come out of the situation regarding the vulnerable supply chain. By seeing all the factors of the supplier base, it can be concluded that the threat regarding suppliers is high for the brand.
Power of buyer
As it is a commonly known fact that, the customer base is the main factor for any brand. Catering to the demands of customers should be the ultimate goal for any brand. The bicycle firm has a very loyal and broader customer base due to the quality of its products. Moreover, the demand for carbon-fabricated bicycles is rising among consumers and the company has an opportunity to fulfil that demand by providing similar products at a reasonable price (Liu et al. 2019). On the contrary, carbon-fabricated bicycles are costlier compared to older metal-made models. Therefore, the brand can satisfy the consumer’s expectation with the help of 3D printing technology which would reduce the price of the product substantially. Hence, the threat regarding consumer power is medium.
Substitute product
Currently, there is no other substitute for carbon-fabricated bicycles which is more sustainable and environmentally friendly. Although, there are substitutes which are faster in mobility and more cost-friendly (Hallberg et al. 2021). On the contrary, the preferences of products differ for different people as per their needs, so it may not be a concern for the brand regarding the substitutes in the current times. Although, the brand should keep up the innovation process to introduce more innovative products. The threat regarding this aspect is high.
2.4 Porter’s Generic Strategy
Cost leadership strategy
The objective of the cost leadership strategy is to position an international bicycle firm as the lowest-priced provider in its market. To successfully compete for market share, they must do more than simply have the lowest production costs among manufacturers. If international bicycle firms do so, they expose themselves to an onslaught from low-cost competitors who may attempt to undercut their prices.
Differentiation
It is essential for large corporations pursuing a differentiation strategy to keep their new product development processes as flexible as feasible. If they do not, they leave themselves vulnerable to competitors employing focus differentiation strategies in adjacent but distinct markets. If they do so, they will become less susceptible.
Focus
Using concentration strategies, businesses confine their attention to specific market segments. Thus, they are better able to meet the needs of their ideal consumers with cost-effective and highly customised products and services. Due to the unique treatment they receive at these establishments, clients have a tendency to be especially loyal to the brand. Due to this, there is a diminished likelihood that competitors will enter this market.
3.0 Strategic Marketing
3.1 4ps of the marketing mix
The marketing mix of the international Bicycle Company is the blend of four relevant aspects of strategic marketing. The components can be classified as price, product, promotion and place. Every aspect has crucial value in marketing.
Product
The International Bicycle form has decided to adopt developed product objectives in its business. The firm adopted the technology to develop carbon fibre bikes that would be stronger and lighter than metal bikes. The decision has an effective role in changing its product manufacturing process and the quality of the products. The main advantage of the new product is that it can be custom built by the required size, shape, and relevant performance to different customers. Henceforth the developed product will be an important advantage for any firm in strategic marketing through product development (Rahman, and Kuzminov. 2019).
Price
Pricing is a valuable strategic aspect for any organisation in its market. The higher pricing for similar products than other firms will harm the organisation’s marketing. Customers would be attracted by other firms as they get lower prices for similar products(Moqiseh et al. 2020). For Example, the price of current carbon fibre bikes is very expensive, the international bicycle farm has to fix lower prices for its products for gaining sustainable market profits. The adaptation of the 3D manufacturing process for manufacturing carbon fibre bikes will minimise the manufacturing cost of the bikes. Hence, the international bicycle firm can provide the new bikes with lower prices to the customers than other organisations.
Promotion
The new featured bike with lower costs needs a genuine promotion in international markets for gaining sustained popularity and desired profits (Sukanta, and Muis. 2022). The international bicycle firm has to process effective promotion in its outlet’s relevant markets. Furthermore, the promotion will attract people and make them understand the objectives of the features of the newly developed bikes. It has formed the latest marketing division in launching carbon fibre bikes. Effective promotion is very important to state its own identity in the international market. Such customers will understand it as a new bicycle firm, with developed and quality products.
Place
The international Bicycle firm has to analyse the locations of the outlets that would make an effective growth in its business. The marketplace with the capability of providing sustainable profits to the business has a crucial role in the marketing strategy. The analysis of the marketing division’s performances will help the bicycle firm in securing its potent outlets and make further development for launching the carbon fibre bikes. The customer’s analysis and market environment has an effective role in understanding the required product qualities and earning sustainable profit through the development (Ko Jaroen Prasit, and Pumping. 2021).
3.2 Ansoff matrix
The Ansoff matrix is a framework, used by management teams and analysts for ensuring relevant plans and apprising growth initiatives. Furthermore, the matrix helps to identify the risks relevant to various growth strategies. The matrix deals with four primary aspects of any business, including market penetration, market development, product development, and diversification.
market penetration
Market penetration contains the least risks in organisations’ business. Decreasing the prices of these products, gaining competitors in the same market, and increasing marketing efforts are the primary aspects of market penetration(Auma, and Waithaka. 2020). It helps the organisation to identify the competitor in each market and attract new customers in the market by decreasing the prices for gaining a competitive advantage.
market development
The market development strategies deal with gaining target customers in each market and entering domestic and foreign markets. Those aspects are very important for developing a sustainable market with sustainable profits (Babah Daouda et al. 2020). Organisations have to prove genuine services to the customers’ needs, which helps to set up a target customer range in the market.
| Product | ||
|
Markets |
Existing | New |
| Market Penetration | Product development | |
| Market development | Diversification | |
Table 1: Ansoff matrix (Created by Author)
Product development
The product development process is an important part of a sustainable business. Through a proper product development strategy, an organisation can improve its products’ quality and its services to the customers.
Diversification
Diversification is a risk management strategy. That helps an organisation to identify its current risks in the market environment and provides steps to avoid the risks.
The suggestion for the marketing strategy
The International Bicycle Company has to apply the product development strategy in the launching of carbon fibre bikes to its outlets. Proper product development has many roles in its business. Through an effective product development process the organisation can minimise the cost of manufacturing the objects, additionally, it has a role in manufacturing products with sustainable quality (Ammar et al. 2021). That will help the organisation in launching carbon fibre bikes in its international markets at lower prices than its competitors.
4.0 Finance
Finance is the most crucial part of any business because investing money in a business and earning profits from its operations are the primary goals of the investors and all of these are associated with the term finance. Finance helps businesses in understanding the sources of investments and the viability of the revenue models by analysing several results including cash flow statements, balance sheets, profit and loss accounts etc (Bilan et al. 2019). Ultimately, finance helps investors to get a clear idea of the present and past conditions of a business and in making decisions also. The bicycle firm is trying to raise funds from new investors to expand its business globally by financing the advertising and marketing department. The financial viability of the brand would also get benefitted from the new outlet opening strategy and the financing in the R&D department of the brand.
As the company is incorporating 3D printing technology in the manufacturing of carbon-fibre bicycles, the retailers are showing interest to open new outlets due to the less required space for the operation. Previously an outlet required substantial space due to storing a variety of models but now with the technology the required space for outlets reduced which resulted in the reduction in investment during opening outlets. Moreover, the cost of the distribution of the product from the factories also would be eliminated as the models can be printed within the outlets with the help of machines. All of these aspects ultimately, reduce the cost of manufacturing and distribution and would raise the profit margins for the brand. Other than that, the brand would get more investments due to the demand for mobilities without carbon emissions. For instance, regarding investments, the bicycle industry gets funding of 500,000 in each of the first quarter and a total of 2,000,000 in a year, other than that corporates provide an additional 2,000,000 in the following 5th quarter.
5.0 HRM
Human Resource Management is used by human resource managers to create personnel policies and procedures that will support business aspects and strategy plans. It is the internal objective of the organisation and depends on the organisation’s size and the employee types. The responsibility of HR managers is to search for relevant talents and foster the talents in the workforce. Furthermore, a proper HRM boosts communication and cooperation among the workers in the workplace (Lertxundi et al. 2019). Such implementation of the HRM theories will help the international bicycle firm in improving its employee’s productivity and genuine production of quality products.
Strategic Contingency Theory
contingency refers to the tasks of different subunits of an organisation. Each task by the subunit has a potent role in the organisational business. The strategic contingency is dividing the organisational workforce into various subunits, and every subunit has to fulfil specific targets (GAGAI, 2022). This is the way of fulfilling the sustainable goals of the organisation through the fulfilling goals of every subunit. The international bicycle firm has to adopt the HRM theory to operate different business aspects by the subunits. The objectives like product manufacture, promotion, and sale have to be enlisted in different subunits.
Organisational life cycle theory
According to researchers, organisations have life cycles like living organisms. The HRM theory consists of the subjects of organisational growth and development. Henceforth, in every sector of the organisational life cycle, it is impacted by the internal and external environment of the organisation (Schofield, 2020). Hence, the International bicycle firm has to analyse its stage and adopt proper Hrm theory in its new product development. The marketing and sales experts of the organisation have the responsibility to suggest genuine strategies and relevant risks to the business holders. Without the organisational lifestyle theory, it will be very difficult for any organisation to gain proper outcomes from their business operations.
6.0 Leadership
Leadership plays the most crucial role in shaping and establishing any business. A leader is responsible for making decisions on behalf of any organisation. The responsibility of implementing different strategies has always been on the shoulders of leaders. The ambitious or thinking-big nature of a leader is required to create a unique identity for an organisation. Furthermore, the leaders are the ones who lead the path for the other employees to achieve the objectives of the business (Samul, 2019). Therefore, the role of leadership is no exception in the case of the bicycle firm also. Strategies of marketing, innovation and manufacturing are all decided by the leaders after they analyse the stats of the business and by utilising their intellectual capacity. There are certain theories regarding leadership approaches that are often followed by many organisations and businesses to manage their operations. Such theories include transformational leadership, situational leadership and many more. This report would discuss the characteristics of situational and transformational leadership that would help the bicycle firm in its leadership management.
Transformational leadership
Transformational leadership refers to the leadership method which always makes action with the point of view of growth. Moreover, this kind of leader always motivates the teams and employees to push their limits and inspire the workforce with their actions (Stevanin et al. 2020). Leaders with transformational behaviour always take care of their team members and make sure of the job satisfaction aspect also.
Situational leadership
Situational leadership is best for times of stress or crisis. They can make decisions faster as per the present condition of the organisation. For instance, situational leadership is the one that helped organisations to adopt the new transformation during the time of the Covid crisis (Ohunakin et al. ). This kind of leadership always benefits the organisation in making changes in its functioning and incorporating new models in the business.
7.0 Recommendation
Market development
This is very important for an organisation to choose an effective location for its outlet, thus it can make higher sales. According to the International bicycle firm’s carbon fibre bike, the location will make a significant effect on its business. The firm has to analyse its international market and point out the locations, in which the new launch will make higher profits of it, and the carbon fibre bikes be a successful business action for the organisation. Furthermore, the climate and the cultures of the worldwide market should be analysed. It will make the organisation understand the needs and expectations of the local customers(Nam, and Kannan. 2020).
Gaining competitive advantage
Every organisation should focus on gaining a competitive advantage in its market. There are various ways to sustain growth in the business and gain an advantage. The international bicycle firm has to take care of the services provided by it to the customers. A range of loyal customers is very important for the sustainable growth of any organisation(Vilkaite-Vaitone, and Skackauskaite. 2020). Henceforth, the bicycle firms have to apply more strategies like providing additional services, providing parking to bicycles in their outlet sectors, and fixing lower prices for genuine quality products than other firms.
8.0 Conclusion
The report has a proper discussion of the objectives of strategic management, strategic marketing, finance, HRM, and leadership theories of the international bicycle firm. The Bicycle firm is developing its manufacturing process into a 3D manufacturing process. It will be a big opportunity for it in minimising the manufacturing costs of the bikes, and along with that, it has decided to manufacture carbon fibre bikes. The marketing strategies are properly analysed with the business actions taken by the international bicycle firm. Hence, it is concluded that through the report any organisation can make understand relevant marketing strategies and the recommendations will help organisations to make proper growth in business.
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