Final Strategic Plan and Presentation

Strategic Plan, Part II: SWOTT Analysis

Shannon D. James

BUS/475

November 11, 2013

Gregory Kosicki

Strategic Plan, Part II: SWOTT Analysis

Introduction

The paper performs the situation analysis of a new business opportunity O’Magic Auto Sales, Inc. It is a medium size pre-owned auto sales business in the southwest area in Orlando, Florida. The business is surrounded by medium high class families, close to the airport and the community high school. Very often taxi drivers stop by the business looking to buy specific cars like, large size passenger vans, ford crown victorias, and Lincoln town cars. In the external environment analysis, the assignment would discuss legal and regulatory factors, economic forces, environmental forces and social culture forces and their impact on the company. This would be done take into consideration the demography in which the company is operating and the based on the current as well as future business forecast of the segment. Post external the paper would analyze internal environment factors of the company. This would primarily focus on the strategic planning, business structure and business culture of the company.

External Environment Analysis

Legal and Regulatory Analysis

The US market has a lot of competition especially in the vehicle industry, so that this area is one of the largest types of competition. O’Magic will find a lot of competition from several companies in US. (Solomon et al. 2009) said that there are different types and methods of competition one of them is product competition, which is competitors offer a new product to attract the customers for the other brands. Governments and policy have serious effects on large companies, but smart company put itself as an essential partner in supporting the local industries (Fifield, 2007). O’Magic also has with US government secured investment support that has been critical to attract new investments. Also law changes in the near term can have severe impact on the business of the company. Being a new company any changes in legal and regulatory codes can lead t severe material impact on the operations of the company.

Economic Forces

There was a significant impact caused by the global financial crisis significantly (GFC) affected the banking sector and the household debt and consumption to become a fear of consumer turbulence (Abernethy, 2010). Technological factors are the fastest change with the evolution of computers as it makes companies concerned, while showing a new technique that makes the company's products are useless and difficult to handle. This technical development has made a key factor in buying a product (Fifield, 2007). Also impact on banking and household debt means that car financing in the near term won’t be an easy task. This can lead to loss of customers for the company. Also, the company would be required to have special tie-ups with the banks in the area for ease of financing to its customers.

Environmental Forces

Environment is the new challenge for automotive industries where companies see that the environment will be the main obstacle. This factor will reduce the production of cars. Although this factor is a recent issue, but many countries have adopted the idea and started working on it such as US (Fifield, 2007). O’Magic in US has an active role in the protection of the environment by raising awareness about environmental issues and creating hybrid electric vehicles. Moreover, O’Magic has a strategy that is used in new products. This strategy works for using technology to reduce damaged material. Also it work for using resources for the recycling of old products and the following chart shows this strategy.

Socio-Cultural Forces

It is difficult to deal with the motives, needs and beliefs of people, so that companies should read and predict future customer requirements. Every company needs to know the social culture of its customers and the segment in which it is operating. Though Socio-cultural forces won’t have a high and material impact on the operations of the company but as a start-up it needs to know the culture of the people to take a demographic advantage. The company would keep automobiles that are particularly according to the likes of the segment.

Internal Environmental Analysis

Strategy

Strategic planning is defined as the organization’s process that defines its strategies, directions and making decisions about allocating resources for pursuing the strategy, which includes its capital and people. While the appropriate timeframe of a strategic plan depends upon the type of industry in which the company is operating but still in most cases the appropriate timeframe for a strategic plan is 5 to 10 years, depending upon the industry. The company would use best cost provider strategy and differentiation strategy for its business. The strategic planning of O’Magic is to become a large scale automobile dealer in the coming 5 years. . Best cost strategy combines strategic emphasis on low cost as well as focused differentiation. It focuses on giving its customers more value for money. The aim of focused differentiation strategy to be employed by O’Magic Auto Sales is to secure a competitive advantage through offering customers of niche market with a product that they perceive as vary well suited to their needs, tastes and preferences. The strategic target of focused differentiation strategy is a narrow market in which needs and preferences of the buyers are distinctively different. Attributes appealing specifically towards niche members forms the basis of competitive advantage in focused differentiation strategy. The company would aim to raise the level of customer satisfaction through the strengthening Bonds and building strong long-term relationship. Also speed up the growth and the emergence of the brand through the company attract customers, and instill the desire to acquire a car through a phased and offers different services.

Business Structures

Though the company is a small organization being a start-up but it needs to have a proper business structure. I truly conquer with the idea that hyper-competition organizations should adopt a decentralized structure. An organizational structure is the structure designed within the organization for task allocation, supervision as well as coordination. Different types of organizational structure are as Functional structure, Bureaucratic structures, Divisional structure and Matrix structure. Decentralized and centralized structure forms the major categories of organizational structure. In the current competitive scenario even a small organization like O’Magic needs to have a defined organizational culture.

The company thrives of innovative techniques in terms of selling automobiles. So the company would have Self-Managed work teams as its organizational structure. It also form a part of a prevalent organizational structure prevalent in the current scenario. Self-managed work teams are the teams formed in the O’Magic Sales will consist of around 12 to 15 employees that are then assigned the responsibilities those were formerly being handled by their supervisors. The responsibilities included the plan and design of work schedules, operating decision making capacity and to handle the problems related to work. These teams within the organization are completely by themselves, that reduces the supervisor’s role in the organization. Many of the organizations in the present scenario, has used the concept of self-managed teams successfully and effectively, but some of these were not able to convince about of team value to their employees. The employees in O’Magic sales will feel that co-operating the concept of self managed work team is analogous with the assistance of their own execution.

Business Culture

O’Magic sales will use hierarchy business culture in its organization. Hierarchy culture is more inclined towards maintaining proper hierarchy levels within the organization where each employee has a reporting authority and a boss. This type of culture defines the career goals of an employee in terms of fixed systematic promotions and salary appraisals over the job years. The organization would have proper hierarchical structure wherein there are ground staff that are there at the showroom and agency, showroom managers, garage manager, area manager, regional managers and so on. The proper hierarchical structure maintains a proper reporting authority within the organization.

One of the completive advantages that our business has is that each client or potential client is treated like family to develop the long-lasting relationship that our mission establishes. This is important because our business plan is to be operating for years to come and establishing trust in clients who will bring customers coming back and provide referrals.

Conclusion

The paper performs the situation analysis of a new business opportunity O’Magic Auto Sales, Inc. It analyzed numerous internal and external environment factors that could affect the operations of the company. It also analyzed strategies and tactics required by the company to perform well under the prevailing circumstances. Based on the factors above it can be concluded that the company needs to focus on its core strategies to surge ahead of competition.

References

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