Chester Company Essay Example for Free

Chester Company Essay A unique and interesting problem arose when one company, a monopoly within the business-to-business (B2B) sensor market, split into six companies with identical products and equal footing within the market. As Director of Finance for Chester Company, one of the newly formed entities, it is important for me to identify a strategy that will enable the company to remain viable and be successful in the future. An in-depth analysis of the industry situation report provided good metrics to project future customer desires and total market potential. In order to be successful, the strategy that the management team develops must work within the identified parameters while attempting to predict how the other five companies in the B2B sensor market will proceed. There are only two segments of the B2B sensor market: low technology and high technology. The only product Chester Company offers currently fulfills the needs of both markets but this will change as the newly formed entities revise and develop products to meet customer needs. The high tech segment is appealing but will require continual investment in research and development to maintain the standards that customers expect. It will be easier to meet the needs of the customers within the low tech segment but there will likely be more competition for market share. 1. The strategy that I would like to see the management of Chester Company adopt over the next five years is that of â€Å"niche cost leader† (Capsim Management Simulations, 2012) for the low technology segment of the B2B sensor market and to obtain thirty-five percent of that market. This will be achieved by appealing to customers’ sense of thrift. To cut prices below the competition, management should retain the current product and not invest much in research and development. Production costs must also be greatly reduced. To do this, an early investment in automation is necessary as it will reduce labor expenses in future years which will increase the margin and profitability of the company. This investment will be financed through the issuance of stock and long term bonds. I also plan to provide the marketing department with a very generous budget in the first couple of years to aggressively target the market and increase the awareness and accessibility of the product early on. Short term borrowing will be necessary to finance operations and provide a cash cushion to prevent the need for an emergency loan. 2. There is a great chance for Chester Company to earn good profits within the low tech segment over the next five years. Although the price of the product must be kept to a minimum this will be offset by decreasing costs which increases the contribution margin. Also, there is greater demand for products in the low technology segment of the B2B sensor market which is expected to increase approximately ten percent each year. However, Chester Company shareholders may realize a loss in the first year due to the high marketing budget and cost of labor because the automation rating is low. Unfortunately, some sacrifices will need to be made early on to realize greater profits in the long term. 3. The product that is most important to the success of Chester Company is Cake; the product currently being produced. During the first year of business, this product will have the ability to appeal to customers across both segments of the B2B sensor market and will ultimately become the favored product of the low tech segment. Management will take advantage of the dual appeal of Cake in the first year by taking a portion of both the low tech and high tech markets in an attempt to retain some profitability. Ultimately, the product will be positioned so that it takes a large portion of the low tech market and will likely not take any portion of the high tech market by the fifth year. The plan that I developed focuses primarily on the success of the company for the next five years as there will be a lot of volatility in the market and further projections are impossible to make at this time. It is difficult to predict how the competitors within the B2B sensor market will be positioned which makes it essential for management to decrease costs as much as possible and increase market share within the low technology segment of the market. My advice to the rest of the management team is to avoid the appeal of developing a new product for either market early on and to avoid the high tech market altogether within the first five years because it will be difficult enough to remain profitable and succeed without squandering business assets on developing a product which will have little chance of being profitable within that timeframe.

Fossil Story Essay Example for Free

Fossil Story Essay Northeastern Illinois has a great deal of geological history hidden beneath the surface. If you just take a trip to the Larson Quarry or even Pit 11 you can find some interesting rock formations as well as fossils in them. But, if you cannot get to these areas, this paper can tell you what you can find in 5 different locations in Northeastern Illinois. We will be looking at Larson Quarry, Thornton Quarry, Mazon River, Pit 11, and the Glacial Drift which is at Palos Hills and throughout the surface of the Chicago area). The first stop is the Larson Quarry. This is located near DeKalb, Illinois. The specific coordinates are 42? N, 88? 35’ W at 920 feet. This site contains specimens from 450 million years ago which include trilobites like Flexicalymene, brachiopods like platystropia, rafnesquina, leptaena, the horn coral streptelasma, an unnamed bivalve, bryozoans, various crinoid stem parts, the cephalopod endoceras, and the gastropods cyclonema and malcurites. The rock types and formations that were found around these fossils were Cincinnatian Maquoketa Shale and Galena Dolomite. â€Å"The Maquoketa shale, which contains seams of argillaceous dolomite†¦and ranges from highly to slightly weathered, with the highly weathered portions having the consistency of a stiff clay and are extremely fissile† (Preber). These fossils were preserved by replacement as well as mold and cast. The Mazon River, which is near Morris, Illinois is located at 41? 20’N, 88? 30’W at 525 feet. This site had fossils from 290 million years ago and included seed ferns like alethopteris and neuropteris, true fern Pecopteris, horsetail rush parts calamites (trunk), and annularia (leaf whorl), lycopod tree (club moss) parts and bark lepidodendron, and leaf lepidophylites. The rock types were shale and sandstone as well as coal and the formation was Francis Creek. The Illinois State Museum writes in an article about how Francis Creek formation is formed: â€Å"Much of the area that we now call Illinois was a mixture of swampy lowlands and shallow marine bays. From the northeast flowed at least one major river system. The river(s) built large deltas through the low swamps and into the shallow bays. The mud that the river(s) carried was deposited in these deltas and bays. This mud turned into a rock called the Francis Creek Shale†. The preservation type was impressions in concretions. Next is Pit 11 which is the Mazonia/Briadwaood State Fish and Wildlife area at 41? 15’N, 88? 15’W at 590 feet. These specimens were found from 290 million years ago. The fossils include the same basic plants as the Mazon River. They also include jellyfish like the essexella, the shrimp belotelson, clams like edmontia and aviculopectin, an unnamed marine annelid worm, a possible fish fossil coprolite, the infamous Tully Monster: tullymonstrum, and the echinoderm sea cucumber holothurian. The rock types that held these fossils were shale and sandstone, as well as coal. These were in a Francis Creek formation. These fossils were preserved by impressions in concretions. It becomes quite apparent that there are certain biases in how and what fossils are preserved. Some species, notably Pecopteris unita, are found with fertile structures nearly half of the time while others like the more common true fern, Pecopteris acadica, are rarely seen with fertile structures being preserved at all† (Mazon Creek†¦). This tells us how these fossils were formed. Thornton Quarry, at coordinates 41? 35’ N, 87? 35’ W at 590 to 250 feet, is located on the south side of Chicago. This Quarry was formed 420 million years ago and includes fossils such as the trilobite calymene, brachiopod pentamerus, corals like favosite and halysites, an unnamed crinoid stem and the cephalopod moorecoceras. The rock types that were here were limestone-dolomite in Niagaran Racine Dolomite with fossils in mold and cast. â€Å"The most famous reef unearthed in the Chicago area is the coral reef†¦Debris from the growing reef began to be deposited and cemented. The reefs contained sea lilies, animals resembling horseshoe crabs, and ancient ancestors of squids and octopuses up to ten feet long. The ashy, gray-white limestone mined from the Thornton Reef contains the fossils of these animals† (Herweck). The reason that there are multiple types of coral is because this area was at the bottom of the Silurian Sea and molded well into the limestone. Lastly, we visit Palos Hills which includes the Glacial Drift. This area was from ~15,000 years ago and showed deposits of unconsolidated pebbles, sand, silt ad clay which contain mixed rocks of 400 million to 1 billion years old at 41? 41’N, 87? 50’ W at 772 feet. The fossils found here are mammoth or mastodon remains that are preserved as unaltered hard parts. There are also mixed marine fossils including crinoid stems, brachiopods, corals like hexagonaria (Petosky Stone) and trilobite parts, where were preserved as mold and cast r replacement. The glacial till include striated rocks composed of a mixture of many types including sedimentary (limestone/dolomite), igneous (granite, basalt) and metamorphic (gneiss). The formation was Valparaiso Moraine. â€Å"At this time, glacial ice covered the entire Chicago region†¦. the active ice sheet retreated into the Lake Michigan basin, although stagnant, melting ice remained behind. The ice then rapidly re-advanced to the†¦Valparaiso moraine in the western Chicago region† (Grimm). The glaciers that were in Chicago made a big impact on picking up rocks and sand and dirt from other regions and bringing it into the area, which is a reason why you may find interesting things in the area and that rocks age from 400 million to 1 billion years ago. The areas that we can find an assortment of fossils and rock formations are abundant in Illinois and have a wide variety of ages. From this summary, you can see what type of rock are around Northeastern Illinois and what type of animals, plants, and rocks were around from different periods and what type of environment they must have lived in.

Impact of Economic Crisis on Tourism: Literature Review

Impact of Economic Crisis on Tourism: Literature Review Literature review on how economic crises affect tourism Hospitality industry affected by crises such as the economical one theses days. Customers buying decisionPower influenced when they want to travel by crisis or financial aspects. Affect on arrivals, expenditures, number of nights stayed, volume due to a crisis (economic and financial)? Explain law of supply and demand, and give a model related to hotels or tourism if possible. The impact of crises, particularly economic crises, on the tourism and hospitality industries is illustrated sharply by Watkins (2002), who details how the depressed economy of the United States following the dot com crash led to a rapid decline in the American long haul public transportation system, with significant implications for the US tourism and hotel industries. In addition, not only did the weak economy in 2000 and 2001 create issues in the industry, but the attacks on the 11th September 2001 dramatically decreased travel across the country. However, Watkins (2002) demonstrates that this also led to customers exercising greater power when making their buying decision, with many companies choosing lower class options for business travel, and tourists using the power of the Internet to look for the lowest air travel prices. In addition, the economic and terrorist crises actually benefitted US low cost carriers, allowing Southwest Airlines to reach a critical mass of services, and hence take on the major flag airlines such as American Airlines and Delta. Indeed, the evidence indicates that during a significant economic crisis, the tourism industry shrinks, but changing consumer preferences tend to minimise the impact of this shrinking, and allow some sectors to grow. Looking at the current economic crisis, Clausing et al (2007) report that many travel executives are confident that the industry as a whole will survive the current recession, and even emerge stronger, and with higher net profits than originally forecasted. This is further supported by Taylor (2008), who reports that whilst sales of traditional holidays in the UK country fell by a quarter over the summer of 2008, with many predicting a further 12 per cent fall over the summer of 2009, this reduction in capacity will provide future benefits to the industry. In particular, the reduction is expected to result in an six or seven percent increase in prices in 2009, which will help the surviving agencies and operators to boost their profits and secure their operations. However, whilst widespread national or international crises, such as the one occurring at the moment, offer opportunities for some firms in the industry; localised crises can have a devastating impact on arrivals, expenditures, and volume in the local area. The Economist (2003) details the impact of the outbreak of severe acute respiratory syndrome, SARS, on the economy of Hong Kong where it was most concentrated. In Hong Kong at the height of the outbreak, hotel occupancy fell by almost 80 per cent and the two main passenger airlines: Cathay Pacific and Draganair, lost more than 60 per cent of their traffic. Restaurants and hotels in the city also saw almost no economic activity, and retail prices continued their falls which were initiated by the Asian financial crisis in the late 1990s (The Economist, 2003). The Asian financial crisis itself was a significant one, and had a major negative impact on tourism across the industry, particularly amongst Asian airlines which lost many of their business class passengers. However, in this case the economic crisis created a fall in demand which acted as a catalyst for a significant change to the supply side of the industry (Sadi and Henderson, 2000). In particular, the Asian airlines recognised the need for high levels of adaptability in their supply of services, including the need to be flexible around costs in case of falls in revenue. The supply side pressures led to an increasing extension and consolidation of the various strategic alliances in the industry, as well as organisational reorganisation and the adoption of new technologies. These changes allowed the most successful players in the industry to weather the crisis and gave them the potential to emerge from it in a stronger situation (Sadi and Henderson, 2000). Indeed, even major crises can provide a boom for some tourist activities in the region where the crisis occurs. This can be seen in Pearce’s (2001) analysis of the development of the New Zealand tourist industry during the 1990s, which was strongly affected by the Asian economic crisis. As a result of this crisis, only the most resilient hotels, airlines and other tourist offerings were able to thrive, hence creating an industry able to rapidly adapt to changing tourist tastes and market conditions. This led to New Zealand developing one of the most diverse and complex tourism industries in the region, giving it significant appeal to a wide range of tourists (Pearce, 2001). Finally, whilst the tourism industry can be strongly damaged by economic crises, it can also reap the benefits of events which occur as a reaction to said crises, or from attempts to resolve them. This is demonstrated by Bue-Said (2008) who claims that the victory of Barack Obama in the US presidential elec tion will tend to be of significant benefit to the tourism industry in the United States: not only will Obama’s proposed rescue package for the US economy stimulate tourism, but as the first African American President of the United States, Obama may well be a tourist attraction himself. References Bue-Said, J. L. (2008) Black clouds could be lifting. Travel Weekly; 14th November 2008, p. 26. Clausing, J. Baran, M. and Compart, A. (2007) Industry is upbeat despite credit crunch. Travel Weekly; Vol. 66, Issue 38, p. 16. Economist (2003) In intensive care. Economist; Vol. 367, Issue 8321, p. 20. Pearce, D. (2001) Tourism. Asia Pacific Viewpoint; Vol. 42, Issue 1, p. 75. Sadi, M. A. and Henderson, J. C. (2000) The Asian economic crisis and the aviation industry: impacts and response strategies. Transport Reviews; Vol. 20, Issue 3, p. 347-367. Taylor, I. (2008) Holidays out of UK down by a quarter. Travel Weekly; 14th November 2008, p. 2-3. Watkins, E. (2002) Another Threat to the Hotel Industry. Lodging Hospitality; Vol. 58, Issue 12, p. 2. Methods for Business Analysis: PESTLE and Porters Five Methods for Business Analysis: PESTLE and Porters Five According to Johnson scholes (2005, Page 9) strategy is the direction and scope of an organisation over the long period, ideally which seeks to match its resources to its changing environment and in particular its markets, customers or clients so as to meet stakeholders expectations. Strategy is viewed as a link between the firm and its environment (Grant, 2008). For a strategy to be successful it should be in harmony with the firms internal environment such as goals, values, resources, capabilities and systems, and the external environment in which it operates. Developing effective strategies cannot take place without firstly (Vignali et al, 2003) analysing the external environment in which the company operates. Vignali Vrontis, (2004) further suggested that environmental scanning of both the external and internal environment is necessary to formulate the strategy to reach their objectives. For an organisation it is important to analyse the macro environment which comprises of political, social, technological and economical issues; industry experts use PESTLE to analyse this macro environment. PESTLE is a tool used to analyse the external business macro environment in identifying how future trends might impact on organisations within an industry. Macro environment factors will impact to a greater or lesser extent on all companies in the business environment (Johnson Scholes, 2008). Pestle stands for Political, economical, social, technological, legal and environmental. Political- legal, factors include antitrust regulations, environmental protection laws, tax laws, foreign trade regulations, stability of government, European issues ;Economical factors such as GDP trends, interest rates, money supply, inflation rates, unemployment levels, exchange rates, foreign trade regulations; Sociocultural- lifestyle changes, consumer activism, career expectations, demographics; Technological changes such as New products, internet, telecom, networking. An example of PESTLE ANALYSIS for Airline Industry The political factors such as government support for national carriers, security control, restrictions on migrations will have a major impact on the industry. Economic factors such as national growth rates, fuel prices, recession, employment affects the airlines business. Social factors such as consumer spending, international holidays and International student exchange programmes, Olympics directly increase the sales of the business where as in technological factors such as fuel efficient engines, security check machines, online ticketing systems and environmental issues such as noise pollution, carbon emission regulations changes in any of the above factors will have a impact on the airlines industry. According to (Johnson Scholes, 2008) it is very important to find the key drivers for change rather than overwhelming on all the details of the environment factors, as the key drivers may vary within industries. The external forces impact the immediate environment (Johnson et al, 2005) creating competitive forces on the organisation in the industry. It is very important for managers to be aware of the companys environmental factors, competitive forces in the industry, which showcase the attractiveness of the industry and the success or failure of a particular company (Mintzberg et al, 1998). These environmental factors can be categorised either as opportunities or threat and are included in the strategic formulation. Porters five forces: Porters five forces model provides a useful basis to examine the extent of competition in an industry. Attractiveness of an industry with competitive forces can be identified with the help of five forces framework. The profit potential of an industry can be determined by collective strength of the five forces (Mintz berg et al). The five forces are: threat of new entrants, threat of substitute products or services, bargaining power of suppliers, bargaining power of buyers and rivalry among existing firms. Customers, suppliers, substitutes, and potential entrants are all competitors to firms in the industry (Porter, 2004, 2008). If all these forces are strong, the more limited is the ability of established companies to raise prices and earn greater profits (Wheelen Hunger, 2002; Hagen, 2010). A company can earn greater profits if there is a low competition force in the industry and a high competitive force can be viewed as threat since it may reduce profits. Many authors Johnson et a l, 2008; Mintzberg et al,1998 ;Wheelen Hunger, 2002 ; Thompson Martin 2005;Grant, 2008 have used the porter five forces frame work in the academic texts. Threat of new entrants: New entrants bring new capacity; desire to gain market share and substantial resources (Mintzberg et al, 1998). The threat of entry depends on the height of barriers (Porter, 2004) and the reaction from existing competitors. Some of the entry barriers are Economies of scale: Economies of scale prevent the entry by forcing the potential competitor to come in on a large scale or to accept cost disadvantage. As the existing firms gain economies of scale through mass production and standard products from the suppliers there by enjoying lower cost per unit. Product differentiation: Existing firms have a brand differentiation and customer loyalty which has achieved by creating value to the customer, Differentiation creates a barrier to entry as the potential competitors needs to spend heavily to gain the market. Capital requirements: Capital requirements create a barrier to potential competitors as they need to invest huge amount, although it creates a barrier, if the returns are attractive then the potential competitors may enter the industry. Cost disadvantages independent of size: established companies enjoy cost advantage, which is not available to the potential competitor, as the existing firms have proprietary technology, availability of best raw materials, proprietary product knowledge Access to distribution channels will deter the entry of potential competitors and even the government regulations which prevents or limit entry into certain industries by restricting access to raw materials. Rivalry among existing firms: Rivalry among existing competitors takes place to gain market share from each other in the industry. The intensity of rivalry depends on several factors such as Number of competitors: if the competitors are equal in size there would be high rivalry as all the competitors try to gain dominance in the industry. Rate of industry growth: slow growth leads to price wars to gain market share. Height of exit barriers: its the opposite side of entry, as the firms investments in specialised assets, or managements loyalty (Porter, cited in Mintzberg et al,1998) huge amount in a particular business, keeps companies in market even though if they are running in loss or earning low returns. Bargaining power of buyers: Buyers may be the end consumer. Buyers compete within the industry by reducing the price and demanding for higher quality of products and services and playing competitors against each other. A buyers group may be powerful if the following factors hold true. Switching cost locks the buyer to particular sellers; on the other hand the buyers power will be improved if the seller faces switching cost and it earns low profits, thereby creating great incentive to lower purchasing cost. Buyers can threaten to enter the industry partially and pose a credible threat of backward integration and bargain to bring the prices down. Bargaining power of suppliers: The organisations that produce inputs such as material and labour in to the industry are called suppliers, these suppliers can affect the industry as they have the capability to increase the price or reduce the quality of the goods and services. The supplier group will be more powerful if they have few substitutes in the industry and if the product is functional. A supplier group will be more powerful if they are dominated by a few companies. Firms may pursue a backward integration strategy to gain control of suppliers, but this strategy will be effective when the suppliers are not reliable and charging high prices or not meeting the deadlines. Pressure from substitutes: It is the competition stirred from products outside the industry. According to Porter (2004), substitutes are the products that can serve the same purpose and depends on the willingness of the buyer. They have a tendency to attract a considerable proportion of the market volume and decrease the probable sales volume of the existing players. Also Porter (2004), states that, the price elasticity of a product is affected by substitute products if there are more number of substitutes available, the demand is more elastic since customers have more choices. Limitations: Porters five forces model is a strategic tool that is utilised to identify if a new business, product or service has the potential to be profitable. However, it is important to understand that this model has further limitations in current market environment, since it visualizes somewhat still market structure. Porters model is formerly based on the economic situation in the 80s with tough competition and comparatively stable market structure; it is not able to consider the new business models and viability of the industries like dynamic market entrants and technological innovations which will entirely alter the business models within a small time. For example, computer and software industry is considered highly competitive. However, Five Forces Model is of limited value as it represents nothing more then the snapshots of moving pictures, since the structure of the industry is persistently transformed by innovation. Therefore, as stated by Kippenberger (1998) and Haberberg Rieple (2001), it is not prudent to develop strategy only on the basis of Porters Five Forces Model and should also be examined in addition to other strategic frameworks of SWOT and PEST analysis. Moreover, many academics and strategist have repeatedly challenged Porters framework. According to Coyne Subramaniam (1996), there are three ambiguous assumptions that underlie the five forces: That buyers, competitors suppliers are unrelated and do not interact and collude. That the source of value is structural advantage (creating barriers to entry). That uncertainty is low, allowing participants in a market to plan for and respond to competitive behaviour. In mid 1990s an important extension to the Porters Model was found with the help of the Game Theory (Brandenburger Nalebuff, 1995). The concept of Complementors also referred to as the 6th force was added, which helped in explaining the reasons behind strategic alliances. For example tourism industry and the airline industry are complementary industries. Also it is perhaps not reasonable to assess the attractiveness of an industry autonomous of the resources a company brings to that industry. Therefore to develop a more sound strategy for a firm a Resource Based View (RBV) should be used together with this theory (Wernerfelt, (1984); Rumelt, (1984)). The model should be adopted with the knowledge of its limitations and their use as a part of a bigger framework of management tools, techniques and theories. The five forces determine industry profitability as they influence cost, prices, and investments of firms in an industry and the elements of return on investment (porter, 1990), even though it is criticised but it is still one of the widely accepted model to analyse the competitive forces. After identifying the forces affecting competition and their causes in the industry, the firm will be in a position to identify its strength and weakness relative to that industry. Resource based view (RBV): Resource Based View (RBV) is an economic tool utilized to identify a firms potential key resources. It is more frequently linked with the work of Prahalad Hamel (1990); Rumelt (1991); Grant (1991) and Peteraf (1993). It has an inside-out approach since it deals with the competitive environment facing the organization. Therefore, its beginning point is an organizations internal environment. According to Draft (1983) cited in Barney (1991, p. 101), firm resources include all assets, capabilities, organizational processes, firm attributes, information, knowledge, etc; controlled by a firm that enable the firm to conceive of and implement strategies that improve its efficiency and effectiveness. According to Mahoney Pandian (1992); Hooley Greenley (2005) and Smith Rupp (2002), RBV of a firm describe its capability to delivering sustainable competitive advantage while the resources are managed in way that the end product cannot be replicated the competitors, hence creating a competitive barrier. Barney (2001), states that RBV explains that a firms sustainable competitive advantage is reached by virtue of unique resources, while these resources have the characteristics of being rare, valuable, inimitable, non-tradable, non-substitutable as well as firm specific. According to Prahalad Hamel(1990) cited in Thomspon Martin, Once the core competenecies are developed in the organisations they should be exploited and these core competencies should be flexible and responsive to the changing customer demands in market. The limitation of the resource based view is that it says very little on how resource can develop or change over time (Henry, 2008). The self-motivated role played by individuals within organisations is often assumed to be obvious and therefore rarely addressed. According to Priem Butler (2001), resource based view of strategy lacks details and hence is difficult for organisations to put into practice. Value chain analysis: The concept of value chain was developed in 1980 by Michael Porter, also known as value chain analysis. Value Chain helps in analysing specific activities so that a firm can create value and competitive advantage. Its a chain of activities for a firm operating in a particular industry. Every organisation has certain activities that link together to increase value of the business and these activities form the organisations value chain. According to Lynch (2003), these activities may include purchasing, manufacturing of products and distribution marketing of the organisations products and services. The competitive advantage in value chain is obtained from two sources: (i) differentiation advantage: customer perceives more value from the firms product, and (ii) low cost advantage: a firm provides the product or service at a lower cost than the average market cost. According to Svensson (2003), the value for the final customer is the value only in its theoretical context and not practical terms, which is a limitation of the model. The true value of the product is measured only when it reaches the final customer. Many academics and researchers have questioned the model and its applicability in context of the service industry. Generic strategies: TARGETING AND POSITIONING Positioning determines the profitability of firm in the industry. A firm that positions well in the industry may earn high rates of returns even though if the industry structure is unfavourable (porter, 2004 Pg. 11). Michael porter proposes 2 generic competitive strategies for outperforming other corporations in a particular industry: lower cost and differentiation (Wheelen Hunger, 2002) These competitive advantages combined with scope of activities, for which the firm seeks to achieve them lead to three generic strategies for by performing above there average in an industry: cost leadership, differentiation and focus (porter, 1990) Lower cost and differentiation strategies seek broad mass market while focus strategies aim at niche (narrow) market. The diagram below represents the porters generic strategies Cost leadership and differentiation strategies seek competitive advantage in a broad range of industry segments while focus strategies aim at cost advantage in the narrow segment. The focus has two variants, cost focus and differentiation focus. Cost leadership: This strategy focuses mainly on gaining competitive advantage by having the lowest cost in the industry (Porter, 2004), Mintzberg et al, 1998; Johnson et al 2008). According to (Malburg, 2000) to achieve the low cost benefit, the firm should have low cost leadership, low cost manufacturing and low work force strategies but (Hyatt, 2001) states the firms should have a large market share to gain the cost advantage, contrary to this Malburg (2001), Davidson, (2001) state that the cost leadership can be achieved by mass production, economies of scale, product design, R D, access to raw materials, proprietary technology, mass distribution. Having a low cost position yields the company above average returns even if they have strong competitive advantage. But according to porter (1985), only one firm in the industry can have the advantage of cost leader but Malburg (2000) stated that competitors fight through low cost leadership roles. Since low cost leadership firms have bigger market shar e, they will have high bargaining power with suppliers and enjoy above average on investments( Wheelen Hunger,2002) contrary to this( Cross, 1999) states cost leadership have certain disadvantages, as they create little loyalty to the customers and if the firm reduces the prices it may loose profits. Differentiation: The second generic strategy, companies using this strategy focus to be unique in the industry by offering products or services which are highly valued by buyers (Porter, 2004; cross, 1991; Hyatt, 2001). Differentiation is done by tailoring the customer needs and charging a premium for the customisation in the market. Differentiation strategy is more likely to generate revenue higher profits than low cost strategy as it creates a defensible position (Porter, 2004. pg .37) for coping with five forces. The customer loyalty and need for uniqueness creates a barrier of entry for potential competitor (Wheelen Hunger, 2002, Porter, 2004).According to (Mc Cracken, 2002) the key step in developing a differentiation strategy is to find how the company is different from the competitors. Mc Cracken Davidson suggested that the differentiation can be the market sector, quality of work, product, delivery system and the marketing approach and to be effective the message of differentiation should reach the end users. (Hyatt, 2001) says that firms must add a premium to the cost when using differentiation strategy however Hlavacka et al (2001) argued that cost and prices are not considered as the ma in focus but on the other hand Cross (1999) stated that since customers are loyal to the company and are willing to pay the higher price for its product. Focus: According to Porter; Davidson, (2001); Cross, (1991), the firms which follow this strategy target a specific segment of the market, this strategy is completely different from the others as it relies on narrow competitive scope in an industry (porter), the company can focus on a selected group of customers, geographical area, product range, focus strategies are effective when consumers have preferences and if the niche market is not recognised by rival firms. The focus strategy has two variants. Cost focus: Firms seeks cost advantage in the target market segment. Cost focus is a low cost competitive strategy and exploits cost behaviour differences in some segments. In using this strategy the company seeks a cost advantage in its target segment. Differentiation focus: Firms seek differentiation in its target market. Differentiation exploits needs of buyers. According to Wheelen Hunger (2002) there are various risks involved in implementing competitive strategies, none of the strategy guarantees to achieve success and some companies implemented porters strategy and failed to sustain the strategy. Some companies that try to attempt cost leadership and differentiation is stuck in the middle (porter). Helms et al, 1997 says that there is much debate on using two generic strategies at the same time. But according to Porter differentiation and cost leadership are mutually exclusive (Porter), on the other hand Helms et al (1997) found companies that used combination strategies have higher returns on investments. Ansoff Matrix The Ansoff product/market growth matrix Ansoff, (1988), cited in Johnson et al(2008), provides four alternative directions for strategic development, according to this model the firm can decide their strategy depending on the resources. This matrix helps the firm to determine the growth strategies of the firms. Market penetration: The strategy of increasing the sales in the current market with the existing products. They spend heavy budgets on advertising to create customer satisfaction and to attract the customers from the competitors, there by creating a high competition. Product development is the strategy of increasing sales with the development of current product or by developing new product. Developing a new product in the current market needs lot of innovation as they should match the customer taste. Market development is the strategy of increasing sales of the existing products in a new market attracting new customers, moving to new geographical area, new segments. Diversification takes the firm completely away from the existing market and the existing products. Diversification takes place when new products are developed and sold in new markets. Diversification allows the firms to spread the risks in a wide array of markets. Swot Analysis: Swot is an acronym of strengths, weakness, opportunities and threats. Scanning of external environment STEP, Porters five forces, for opportunities and threats and internal environment such as resources, capabilities, financial, marketing, value chain, technology for strengths and weakness is an important part in developing strategic planning. According to Vrontis, (1999), it is very important if the companies want to capitalise on their strengths and minimise weakness, exploit market opportunities as they arise and avoid threats. SWOT gives us the key issues that may impact on strategy development (Johnson et al, 2008). It can also be used to convert weakness into threats and threats into opportunities. RYAN AIRWAYS AND BRITISH AIRWAYS They would like to understand the underpinning logic of the strategy choices/generic strategies available to them and you have asked you to provide some detailed illustrations from the airline industry. The product/service differentiation visions and strategies of SIA, BA and UAL, as they prepare for the new millennium, provide interesting contrast and comparison insights and lessons on product/service differentiation for the industry as a whole SIA is strategically positioned in the premium service, quality and value market segment of the international airline industry. Service is the raison de tre of SIA, and at the heart of its service reputation is the Singapore Girl. Since the late 1980s, SIA has always held the view that: The airline industry is, by its very nature, a service industry. In a free market, the success or failure of an individual airline is largely dictated by the quality of the service it provides (Harvard Business School, 1989). http://www.emeraldinsight.com/Insight/ViewContentServlet?Filename=Published/EmeraldFullTextArticle/Articles/2610310604.html#2610310604001.png References Porter, M. E., (2004), The global competitiveness report 2004-2005, Basingstoke: Palgrave Macmillan. Brandenburger, A.M. and Nalebuff, B.J. (1995), The Right Game: Use Game Theory to Shape Strategy, Harvard Business Review, Jul-Aug, pp.57-71 Coyne, K.P. and Subramaniam, S. (1996), Bringing discipline to strategy, The McKinsey Quarterly, No.4 Haberberg, A. and Rieple, A., (2001), The Strategic Management of Organizations, Essex: Pearson Education. Kippenberger, T., (1998). Strategy according to Michael Porter, The Antidote, Vol. 3 No.6, pp. 24-25. Wernerfelt, B., (1984). The Resource-Based View of the Firm. Strategic Management Journal; Vol.5 No.2, pp. 171-180. Rumelt, D.P., (1984), Towards a Strategic Theory of the Firm, Alternative theories of the firm, International Library of Critical Writings in Economics, vol. 154. Cheltenham, U.K and Northampton. Wheelen, T.l Hungher,J.D.,(2002) Strategic management and Business policy, 8thed. New Jersey: Pearson education. Grant, R.M, (2008) Contemporary strategy analysis. 6th ed.Oxford: Blackwell publishing Porter,M.E, (2004). Competitive strategy. Edition 2004: First free press. Johnson.G, Scholes.K, Whittington.R, (2008). Exploring Corporate Strategy Text and Cases. Edition 8.Essex: Financial times prentice hall Pearson education. Johnson,G, Scholes,K, Whittington.R, (2005). Exploring Corporate Strategy Text and Cases. 7th ed.Essex:Financial times prentice hall Pearson education. Mintzberg,H. Quinn,J.B. Ghosal,Sumantra. (1998).The strategy process,revised edition. Prentice hall Europe: Pearson education. Porter,M.E. (2004).Competitive advantage.Edition 2004. First free press. Watts,G. Cope. J Hulme.M (1998). Ansoffs matrix, pain and growth strategies and adaptive learning among small food. International journal of Entrepreneurial behaviour and research, vol.4.No.2, pp 101-111. Davidson, S. (2001). Seizing the competitive advantage. Community Banker, Vol. 10 No. 8, pp.32-4. Cross, L. (1999). Strategy drives marketing success. Graphic Arts Monthly, Vol. 71 No. 2, p. 96. McCracken, L. (2002). Differentiation: win new business with less effort, Principals Report, Vol. 2 No. 4, p. 1. Cited in Allen.R.S, Helms.M,(2004) Linking strategic practices and organisational performance to porters generic strategies, Business process management journal ,vol. 12 No.4 ,pp.433-454. Malburg, C. (2000). Competing on costs. Industry Week, Vol. 249 No. 17, p.31. Cited in Allen.R.S, Helms.M,(2004) Linking strategic practices and organisational performance to porters generic strategies, Business process management journal ,vol. 12 No.4 ,pp.433-454. Hlavacka, S. Ljuba, B. Viera, R and Robert, W. (2001). Performance implications of Porters generic strategies in Slovak hospitals, Journal of Management in Medicine, Vol. 15 No. 1, pp. 44-66. Harvard business review 2008 available at: http://www.ascendcfo.com/pdfFiles/HBR-The%20Five%20Competitive%20Forces%20That%20Shape%20Strategy.pdf- Accessed on [10 March 2010] Vignali, C., Vrontis, D. (2004), Global Marketing and Export Management, Foxwell and Davies, London Cited in Vrontis,D. stavrou,A. Kogetsidis.H(2006).Strategic marketing planning for a supplier of liquid food packaging products in Cyprus, Journal of Business Industrial Marketing, Volume.21,No.4 pp: 250-261 Barney, J.B. (1991).Firm Resources and Sustained Competitive Advantage. Journal of Management, 17 (1), pp.99-120. Daft, L.R. (1983).Organizational Theory and Designs, West Pub. Co., St. Paul. Prahalad, C.K. and Hamel, G., (1990). The Core Competence of the organization. Harvard Business Review, 68 (3), pp.79-91. Rumelt, R.P., (1991), How much does industry matter? Strategic management journal, vol.12 No.3, pp.167-85. Grant, R.M., (1991), The resource-based theory of competitive advantage: implications for strategy formulation. California Management Review, 33(spring), pp.114-35. Peteraf, M., (1993), The cornerstones if competitive advantage: a resource based view. Strategic Management Journal, 14, pp.179-91. Mahoney, J.T. and Pandian, J.R., (1992), The Resource-Based View Within the Conversation of Strategic Management, Strategic Management Journal, Vol.15 No.5, pp. 363-380. Hooley, G.J. and Greenley, G.E., (2005). The Resource Underpinnings of Competitive Positions,Journal of Strategic Marketing, Vol.13, No.2.pp.93-116. Smith, A.D. Rupp, W.T. (2002). Communication and Loyalty among Knowledge Workers: a resource of the firm theory view, Journal of Knowledge Management. Vol. 6 No.3, pp.250-61. Barney, J.B., (2001). Is the Resource-Based Theory a Useful Perspective for Strategic Management Research? Yes, Academy of Management Review., Vol.26 No.1, pp.41-56. Henry, A., (2008). Understanding Strategic Management. Oxford University Press. Priem, R.L. and Butler, J.E., (2001). Is the resource based view a useful perspective for strategic management research? Academy of Management Review, Vol.26 No.1. pp. 22-40. Lynch, R., (2003). corporate strategy.3rd ed. London: FT Prentice Hall. Svensson, G., (2003). Consumer driven and bi-directional value chain diffusion models, European Business Review, Vol. 15, No. 6, p. 390-400. Allen.R.S, Helms.M,(2004) Linking strategic practices and organisational performance to porters generic strategies, Business process management journal ,vol. 12 No.4 ,pp.433-454. Executive summary This report provides the strategic tools and techniques used in formulating strategy. This report starts with the external analysis of macro environment by using PESTLE and industry analysis to identify the profit potential by using the porters five forces frame work. The external analysis is carried to identify the threats and opportunities in the operating environment. Internal analysis of the firm is carried out to identify the strengths and weakness of the firm using by using Porters value chain, Resource based view. Porters three generic strategies have been explained for positing of the firm and Ansoff growth/productmatrix is also explained. An overview of ryan airways and british airways has been provided with and to identify then internal analysis frameworks using RBV , porters value chain and porters generic strategies.

Quick Death in The Short Happy Life of Francis Macomber Essay -- Franc

Quick Death in The Short Happy Life of Francis Macomber Ernest Hemingway created a masterpiece of mystery in his story "The Short Happy Life of Francis Macomber". The mystery does not reveal itself to the reader until the end of the story, yet it leaves a lot to the imagination. At the end of the story Margaret Macomber kills her husband by accident, in order to save him from being mauled by a large Buffalo while on a safari in Africa. The mystery is whether or not this killing was truly accidental, or intentional. If it was to be considered intentional, there would certainly have to be evidence in the story suggesting such, with a clear motive as well. What makes this mystery unique is that Hemingway gives the reader numerous instances that would lead the reader to devise an acceptable motive, yet human nature tells the reader that this killing could not have been intentional. From a purely objective analysis of the story, the reader would see far more evidence supporting the theory of an intentional killing rather than an accidental one .    The clues supporting the idea that Margaret killed Francis intentionally can best be seen when observing and studying the background information on both Francis Macomber, and Margaret herself. (Hemingway 1402). What is also important is that Margot and Francis have very different personalities. This is clearly seen when the narrator states, (Hemingway 1402).    With this small amount of background information, the true motive for an intentional killing can be found.   This can clearly be seen in the conversation of Francis Macomber after killing the buffalo when he states, (Hemingway 1408. "(Hemingway 1409). Robert Wilson, the guide on the... ... a man with values and feelings and morals; a man capable of living happily ever after, regardless of the span of his life. The character Francis Macomber, a wealthy American, and his wife, Margot, are on safari with their English guide, Robert Wilson. Macomber wounds a lion and runs away in fear. The guide is horrified at his bad sportsmanship Macomber redeems himself by killing a buffalo cleanly and bravely. he faces another buffalo, a charging, badly wounded bull. From the car where she has been watching, Margot takes aim and shoots at the charging buffalo, apparently to save her husband's life. Work Cited Hemingway, Ernest. "The Short Happy Life of Francis Macomber." DiYanni, Robert. Literature: reading fiction, poetry, drama, and the essay. 3rd ed. Ed. Steve Pensinger and James R. Belser. New York: McGraw-Hill, 1990.

Forgetting the Pain :: World Peace Terrorism Essays

Forgetting the Pain The world as we know it is in dire need of serious changes in the way humans go about interacting with each other. This is often realized by leaders of generations who have become notable as a result of their dedication to progress in this field. Many who approach the struggle have different causes they stand behind, however the goal remains the same: to convince others of tolerance, acceptance, and equality. For Martin Luther King it was segregation, for Gandhi it was the British tyranny in India, and for me it is the hatred and murder between the Israeli’s and the Palestinians. Hatred begets hatred, violence leads to more of the same, and their will never be peace between Israel and Palestine until this becomes apparent to all parties involved. The history of the land is rich with culture and tradition, yet it is shadowed by the blood and countless massacres of the innocent. The roots of the land stretch deep and the religious fervor is intense, yet the weapons of destruction of past wars in this land are left standing as a reminder to the people of the long standing hatred and fear of yesteryears. Both the Israeli’s and Palestinians have been wronged. And neither seems to let that pain go. As each side feels more threatened, each results to more desperate measures, in hope of sending out the message â€Å" We will not sit down and die, and will fight to preserve our cause in any way we can.† Deaf ears on both sides receive and send this message. Just as when two people scream at the top of their lungs, fail to listen to each other. When talking to Israeli’s during my travels to their homeland for my senior year in high school, their plight became apparent to me, their hatred has spawned out of feelings of fear and distrust. For this, I cannot blame them. Their history is one of persecution, in fact some may argue that the very existence of Israel was created as a result of one of the greatest tragedies the world has known, which happened not but sixty year prior to present day. Their history in the land of modern day Israel has not been a â€Å"walk in the park† either. Dating back to the first settlements, which were purchased from Palestinians, was constantly raided and the inhabitants were slain.

total war Essay -- essays research papers

â€Å"[B]oth sides had seen, in a sad scrawl of broken earth and murdered men, the answer to the question†¦.Neither race had won, nor could win, the War. The War had won, and would go on winning.†1 These are the words of Edmund Blunden, a British soldier who survived the Battle of the Somme, who came to the realization that nobody could claim victory in the twentieth-century mass warfare, because both winners and losers paid a high price. The new type of warfare launched in the twentieth-century had a great impact on the modern world that went beyond the immediate cost of casualties.2 The psychological, social, economic and technological effect these wars had on those who survived earned this type of conflict a new name: total war, which encompassed all aspects of life. Before 1914, Western society believed in progress, peace, prosperity, reason, and the rights of the individual. During that time, people believed in the Enlightenment, and industrial developments and scie ntific breakthroughs were a daily reality apparent in the rising standard of living. But World War I crushed all hopes and dreams. It plunged society in an age of anxiety and uncertainty in almost every area of human life. The social impact of total war was also profound. The role of women changed dramatically as the war greatly expanded their activities and changed attitudes towards them. This change was brought about by the total national readjustment and the mobilization of the home front. In order to wage unrestrained warfare, belligerents had to intervene in the economies, diverting production from peacetime goods to the manufacture of munitions and military equipment. Technological advances also took place, which increased the number of â€Å"mechanical contrivances†3 such as heavy artilleries, tanks, submarines, and airplanes, which made war an â€Å"untrammeled, absolute manifestation of violence†4 as Carl von Causewitz so eloquently put it.   Ã‚  Ã‚  Ã‚  Ã‚  Total war marked the beginning of a revolution in thought and ideas, where turmoil, uncertainty, and pessimism replaced the cherished values and beliefs of peace, prosperity, and progress. Men and women in the West felt â€Å"increasingly adrift in a strange, uncertain and uncontrollable world.†5 In his essay â€Å"The Crisis of the Spirit† written in 1919, Paul Valà ©ry, one of France’s most outstanding poets, wrote that Europe â€Å"doubted itsel... ... wars because of the types of weapons used. Hand grenades, machine guns, poisonous mustard gas, tanks, submarines, and airplanes were introduced for the first time. During the Second World War strategic bombing was used, as well as the form of combat called blitzkrieg. The new type of warfare launched in the twentieth century called total war had a great impact on the modern world. It plunged society into an age of uncertainty and pessimism. It also had a devastating psychological effect on the soldiers that survived the war and returned home. In addition, unlimited conflict created a social impact that was seen in the increased participation of women in the economy, and their newly gained right to vote. The â€Å"all-out† war involved as well the massive mobilization of the home front and the establishment of the first totalitarian society. The introduction of machine guns, poisonous gases, tanks, submarines, and airplanes made total war extremely deadly. Hopefully, the lessons learned from the past major wars will be applied by today’s society, and efforts will be made to avoid at all costs another total war. World War I and World War II should remain to be the Wars to End All Wars.

Article “Cradle-to-cradle: the next packaging paradigm?” Essay

In his article â€Å"Cradle-to-cradle: the next packaging paradigm? † David Newcorn suggests three entirely new strategies for packaging items—strategies which may at first instigate eyebrows to rise. On closer look, however, Newcorn’s suggestions may indeed live up to one of its goals: to arrive at a packaging strategy conducive for the environment. Newcorn has three objectives in mind in order to achieve such an end: use more packaging materials, not less; design the best package possible instead of designing with the cheapest materials without worrying about per-package cost, and; ‘littering’ can help the environment. But how are these supposedly ‘environmental threats’ do the exact opposite of further degrading the environment and contribute to the crusade for the strengthening of the environment through strategic and environmentally friendly packaging schemes? In order to arrive at a better understanding of Newcorn’s suggestions, it is equally important to note that what separates Newcorn’s suggestions from the rest is that the suggestions actually target the possibilities of the future. By offering three distinct strategies which may at first seem threatening to the environment, Newcorn turns the table around by citing examples of ‘what if’s’, possible situations which have a high probability of being real sometime in the future. For the moment, however, the efficiency of Newcorn’s suggestions seems to hang in the balance for a few good reasons. First, Newcorn suggests that by using more packaging materials instead of less, we can actually save the environment from being harmed because sometime in the future there will be ice cream wrappers which turn into a ‘biosafe liquid’ or foam food containers which contain essential nutrients which revitalize the earth’s topsoil, for instance. While the prospects for his suggestion are noble, it can hardly be denied that the possibilities remain to be seen. Newcorn even admits that the possibilities are yet to be obtained. If the possible elements in the illustrations he has elaborated in his article remain to be seen, then there is little reason to believe that manufacturers of these products should immediately adopt the strategies he offers. The same goes for the designers who have the same inclinations as Newcorn. In current times, using more packaging materials or ‘littering’ the environment with these materials is only effective in theory. At the least, designers can hardly deny the fact that the current environmental measures being taken all around the world are in startling contrast to Newcorn’s suggestion precisely because the environmental problems which beset the modern societies are the result of piles and piles of garbage produced on a daily basis. What Newcorn’s suggestions give the designers, however, are insights into the future. Although the situations he has given in his article are possibilities, they nevertheless give designers a glimpse of what the future may look like. Given these brief future sketches of packaging strategies, designers cannot simply dismiss the thought that Newcorn’s suggestions are worth the efforts of being studied. Both scholars and designers concerned in the packaging sector may very well agree that there is more than what meets the eye in Newcorn’s assumptions. Technical and biological nutrients may indeed soon take over the packaging materials used in products. Science and technology are constantly evolving and are relentlessly seeking new methods and designs to improve the materials we use daily in the larger effort to preserve the environment. Recycling packages which may soon be eco-effective without the downside of degrading the quality of the packages for commodities is another thought worth pondering (Bendor, Terry and Kenneth, p. 175). Newcorn, however, may be correct in insisting that a large amount of history involving packaging materials should have to be beaten first before anything else of the efforts to resort to recycling and using eco-effective packaging materials can be fully achieved. Much of what companies do in order to sustain their operations is to use whatever is cheaper and more efficient in the market. The fact that bottling companies for soft drinks have relied â€Å"less and less on bottles and more and more on cheap and recyclable aluminum cans as containers (Banks, p. 72)† suggest that money-making ventures may find it difficult to fully adjust and align their packaging strategies according to what Newcorn’s assumptions for the future. Any designer involved in the packaging sector will think that the problems which beset the environment also have consequences on their part and to the rest of the world. Newcorn’s efforts serve as a model not only for the big companies under the packaging sector but also for the average citizen. However, Newcorn’s suggestions face the direct criticism of failing to obtain in the contemporary time which is in deep need of innovations in packaging strategies. It may be high time for designers in the packaging industry to settle down and think of other innovative ideas which will provide ways to counter and prevent environmental problems brought by wastes from packages which are also attainable in the soonest possible time. The future of the environment is indeed filled both with good prospects that are hanging and with contemporary as well as previous problems in terms of garbage from packaging materials which pose problems which cannot be easily set aside for the benefit of acquiring more profit. It is logical enough to presume that the future does not promise anything clear. Yet it would also be absurd to assume that nothing can be done to anticipate and, hopefully, resolve the current environmental problems and the future environmental hazards both at the same time. Newcorn’s suggestions may still lack its applicability in contemporary times. However, the effects and prospects of Newcorn’s suggestions are promising and may prove to be more than useful in the coming years. WORKS CITED Banks, Seymour. â€Å"The Measurement of the Effect of a New Packaging Material Upon Preference and Sales. † The Journal of Business of the University of Chicago 23. 2 (Apr. , 1990): 71-80. Bendor, Jonathan, Terry M. Moe, and Kenneth W. Shotts. â€Å"Recycling the Garbage Can: An Assessment of the Research Program. † The American Political Science Review 95. 1 (2001): 169-90. Newcorn, David. â€Å"Cradle-to-Cradle: The Next Packaging Paradigm? † 2003. Packaging World Magazine. January 13 2008. .