WEEK 18

1.How can using the Change Kaleidoscope and Force-field analysis help an organization to deliver its intended strategy?

Change Kaleidoscope: It is model that deals with all the contextual features and implementation options that are required for consideration when organization undergoes change. The framework of the model helps the managers to design a ‘context sensitive’ approach to change. It contains 8 contextual features that can be assessed as positive, negative or neutral to the change. If it suggests positive then it those features facilitates change and the negative restrict changes.

Organization Contextual Features:

• Time - The time period within which change need to be adept
• Scope - The degree of change, which can be separated into realignment and transformation
• Preservation - The organization assets, culture, or competencies which needs to be retained during change
• Diversity - The level of difference among groups of employees and divisions, who/which will be affected of change, in terms of attitudes, values, and norms
• Capability - The organization competency to implement change in terms of managerial skills and personal knowledge and ability
• Capacity - Organization resources needed for change investment including cash, human resources, and time
• Readiness - Employee's level of change awareness and readiness
• Power - The power needed for initiating change

 The design choices

• Change path: classified as 4 types – Adaptation, Revolution, Reconstruction and Evolution
• Change start point: where the change is initiated
• Change style: type of management style to be adapted
• Change intervention: the types of mechanisms to be deployed
• Change roles: assigning roles and responsibilities

Force Field Analysis: It is a decision-making technique that identifies all the forces that are for or against changes. It helps he managers to strengthen the driving faces that go ahead with the changes and increase the chance of success, and weakening the restraining forces that are against it. 

2. Add your Change Kaleidoscope diagram for Hewlett Packard (Exercise 1 – slide 21) to your Learning Journal.

References:

ProWork Project [Online] Available at: http://www.proworkproject.com/prowork/change-kaleidoscope.html [Accessed on 28 November 2013]

Kaplan Financial Knowledge Bank. Managing Strategic Change [Online] Available at : http://kfknowledgebank.kaplan.co.uk/KFKB/Wiki%20Pages/Managing%20strategic%20change.aspx, [Accessed on 27^th Nov, 2013]

WEEK 17

1.Can you think of an organisation that has implemented a ‘high risk strategy’ that has resulted in success (why was it high risk at the time and why was it a success – was it good luck or good judgment)?

 According to me, Starbucks Corporation has implemented a ‘high-risk strategy that resulted in success.

Starbucks is an American global coffee company. It is one of the largest coffeehouse companies in the world. It has established one of most successful and admired brands in the world.

Starbucks innovative marketing strategies lead to its success. They employed unconventional strategies that are unique and seldom tried, but most perfectly matched with concept that the company wanted to portray. The most important concept it created was it brought space rather than a product. It was successful in fulfilling the psychological need of the customer that other companies failed to do.

Some of their best strategies would be:

Product quality- The Company has always put emphasis on its product quality from the very beginning. The price of the coffee is slightly expensive than the expected but has been successful in satisfying the customer with its rich delicious taste and aroma.

Third Place- The coffee house plays the third place in our lives- home being the first and works the second. It is focused on creating unique atmosphere for the customers where they can relax, meet others and surf the Internet. This has been the strongest concept attached to the company to attract the customers.

Customer satisfaction- Starbucks gives more priority to customer satisfaction from their coffee to the feel of uniqueness in the atmosphere while enjoying the coffee. Their main part of their superior customer service is their focus on customization.

Smart partnership- the main reason for their success and growth is because of strategic partnership with other businesses and Non-profit organizations.

Innovation- Through the years, the Starbucks Coffee Company has been known to think up creative and innovative ideas to add to their products or services. They’ve added different flavors to their coffee, more food on their menu, and even became one of the firsts to offer Internet capability in their stores. (voteforus.com, 2013)

Advertising – Starbucks has always focused on “word of mouth” marketing and let their customer know their high valued quality products and also it has always stayed away from promoting itself through adds in billboards or newspapers.

2.Now, do the same for an organisation who embarked on a high-risk strategy that resulted in some sort of failure (why was it high risk and why did it fail – bad luck or poor judgment?)

I would consider Kingfisher Airlines as an organization who embarked on high-risk strategy that resulted in failure.

A Kingfisher Airline Limited was an airline group based in India. The company has been facing financial issues for many years. Until December 2011, Kingfisher Airlines had the second largest share in India's domestic air travel market. However due to a severe financial crisis faced by the airline at the beginning of 2012, it has the lowest market share since April 2012. Every since the company acquired Air Decan, it has been reporting loss.

The main reasons for the failure of the company would be its strategy of low cost model that changed the whole image and brand of premium business class airline.

Some of the major factor for the failure is:

• Increase in the debt by acquiring Air Decan
• Lack of long-term strategies such as absence of CEO
• Frequent change of focus from full service carrier to low cost and again back
• Lack of understanding of customer’s requirements
• High operational and maintenance cost – increase in fuel price and depreciation in Indian Rupees

Reference:

Starbucks Marketing Strategy Unconventionally Effective [Online] Available at: http://www.voteforus.com/starbucksmarketingstrategy.html, [Accessed on 25^th Nov, 2013]

Forbes. Starbuck's Power over US is bigger than coffee [Online] Available at: http://www.forbes.com/sites/alicegwalton/2012/05/29/starbucks-hold-on-us-is-bigger-

than-coffee-its-psychology/ [Accessed on 25^th Nov, 2013]

Reasons behind Kingfisher Airline failure [Online] available at: http://www.jimsedu.com/wp-content/uploads/2013/07/Reason-behind-Kingfisher-Airlines-Failure.pdf, [Accessed on 25^th Nov, 2013]

The real reason behind Kingfisher's fall [Online] Available at: http://www.sify.com/finance/the-real-reasons-behind-kingfisher-s-fall-imagegallery-2-airlines-llsne4cgief.html , [Accessed on 25^th Nov, 2013]

WEEK 16

1. In your own words and using referenced quotes describe the difference between organic growth, merger & acquisition and strategic alliance.

Organic Growth:

Organic growth refers to the expansion of the firm by developing new competencies and capabilities using that have potential to create value in the future. (Hess & Kazanjian, 2013)

 It involves strategies such as:

• Designing and developing new product ranges
• Implementing marketing plans to launch existing products directly into new markets (e.g. exporting)

• Opening new business locations – either in the domestic market or overseas

• Investing in research and development to support new product development

• Investing in additional production capacity or new technology to allow increased output and sales volumes

• Training employees to help the best acquire new skills and address new technology 

Mergers & Acquisitions:

Acquisition refers to the buying of another company’s assets and liabilities, as the firm continues to exist legally owned as subsidiary of the acquirer.

Merger is the association of two firms to form a new entity by exchanging shares of both companies for shares in the new company.

Strategic Alliance:

It is an agreement where two firms that have decided to share resources to achieve a certain specific goal that is mutually beneficial.

A strategic alliance will help a company to develop more effective process, expand into a new market, etc. 

2. Give an example of a company that has grown through a) organic growth, b) merger or acquisition and c) strategic alliance

a) Organic growth: Beiersdorf Company grown consistently and rapidly through a carefully controlled and well-managed expansion of its portfolio of products.

b) Merger and acquisition: one of the best examples for this would be Disney and Pixar, with which the two companies could collaborate freely and easily.

c) Strategic alliance: Nokia and Microsoft, for example, have entered into a broad global strategic alliance where they plan to combine assets and develop innovative mobile products on an unprecedented scale.















3.Briefly discuss the merger between Britvic and AG Barr. What advice would you give to the new Board? 

AG Barr- maker of Irn Bru is a soft drink company in Scotland that outsells Coca-Cola in its home market where as Britvic is a British producer of soft drinks. Merger between these two companies created one of Europe’s biggest soft drinks companies.

The merged group, to be called Barr Britvic Soft Drinks, will have annual sales of more than £ 1.5bn and employ 4,300 staffs.

According to the inquiry the two companies were not close competitors and had distinctive products rather than close substitutes for each other. (bbc.com, 2013)

The merger represented an opportunity for both companies to enhance their position in the industry.

The benefits from merger are:

• Creation of attractive portfolio of strong and different brands and future growth opportunities
• Achieve Cost and revenue synergies through utilization of combined distribution channels while minimizing risk
• Creating value by sharing same resources and technology
• Expansion of the market as consumer base is combined

The negative effects are:

• Large number of job losses
• Management issues
• Consumer sensitivity- leads to shifting to other brands
• Bankruptcy faced by one firm may affect the other
• Sharing of debt may not be profitable for both the company

My suggestions to the new board:

• Cost control by reducing unnecessary expenses
• Focus on communication and maintain best management style
• More focus on consumer care and feedbacks
• Proper Marketing and Advertising strategies 

Reference:

Kazanjian, R.K.,  Hess, E.D. & Drazin, R. The Search for Organic Growth: Cambridge University Press.

Strategic Alliances [Online] Available at: http://water.org/about/strategic-alliances/ [Accessed on 14th Nov 2013]

Britvic and AG Barr merger provisionally cleared [Online] Available at: http://www.bbc.co.uk/news/business-22852442 , [Accessed on 15 Nov, 2013]

http://www.britvic.com/news/news/2012/14-11-2012.aspx  [Accessed on 15 Nov, 2013]

Britvic Company Profile [Online] Available at: http://www.britvic.com/company-profile.aspx [ Accessed on 14th Nov 2013]