Asia Division Business Unit Strategy
The Executive Director for the new Asia Division
, has been asked by Max Barney to put together, and present in a memo to him, a business unit strategy that will be a guide for the next year as the new division moves forward. The Executive Director will be working with the consulting group over the next 5 weeks and they will assist with putting together this plan. The final plan will be laid out as outlined below and developed in three phases.
You have successfully completed Phase I and it is now time to complete Phase II. In the second phase, Sections IV, V and VI will be completed.
Section I – Executive Summary
Section II – Goals and Objectives
Section III – Competitive Analysis
Section IV – Description of Organizational Structure and Culture (set in Japan)
Section V – Breakdown of Product and Services (Blemish Creams, Color Correcting Creams, Dynamic DO-All or Daily Defense Creams)
Section VI – Communications Plan
Section VII – Human Resources Plan
A Business Unit Strategy will provide the organization an opportunity to explain the goals and objectives of the new division and help with the development of the strategy to achieve them. The plan will allow the company to gain insight into the current status of the industry they are venturing into using internal and external analysis tools, and then use this analysis to design their division’s business environment. In addition, the plan will be used to form the team that will bring the vision for this division to reality. You will need the Biotech Company Profile to complete the analysis.
The Executive Director of the Asia Division of Biotech has asked the GoTo Consulting group that has been assisting with the development of the Business Unit Strategy to begin putting the second phase together. In this phase, the director would like to start painting the functional picture of how the new division will be setup, the products that are believed critical for a successful initial launch, and how the division will communicate within itself, across other divisions, and with the corporate offices. To do this, the group will deliver a Description of the Organizational Structure and Culture section; a Breakdown of Products and Services for the initial Launch; and the Communication Plan.
Description of the Organizational Structure and Culture
In this section, you will lay out the structure that was introduced a week ago and delivered informally to the director. It is intended that this section will now formally present the structure and explain the rationale behind its construction. The idea with presenting the Organizational Chart is to understand why the levels of the chart are developed. Present the Organizational Chart the GoTo group collaborated on in Week 5 and explain why each part of the structure is critical to the success of the organization. For example, if an Assistant Division Director (ADD) Research and Design was placed in the Org Chart, you could explain that they will be responsible for finding ways to integrate green/sustainable materials into cosmetics, something that has not been done on a large scale in the past. The ability to create products that have not been introduced in the market place in mass production will give Biotech a competitive advantage. And under the VP of R&D there is a person responsible for the local testing; explain why their testing will have critical impact on the success of the new product line.
The group will also present the cultural complexities that will need to be monitored and possibly addressed. The director will be bringing a facility online in an area in which Biotech currently has no presence and there could be unforeseen cultural dilemmas that could arise. The GoTo group has considered whether or not to use local nationals in management roles or to bring in current Biotech employees from other locations. Each of these will have their own complexities from a cultural standpoint so consider them as you generate your response. Consider how the new location’s citizens view work hours, holidays, religious beliefs, etc. while researching this topic. Another example about understanding business cultures in foreign countries is how bribery is a big part of business for some cultures but still illegal for a U.S. based company to participate in this act while operating on foreign soil. If the location of the new facility has some cultural differences from what other locations do, you should explain whether Biotech will need to recognize the difference or expect the employees to adhere to Biotech’s standards.
Breakdown of Products and Services
In this section, you will present the products that Biotech will release in the first launch of the new division. These products were also discussed a week ago by your group and will now be formally introduced as the product line. Biotech needs to formally introduce the line of products that it will be presenting to the public and how its production aligns with Biotech’s mission. This section will need to provide specifics on the product and how it meets the sustainable, green, and human friendly mandate set forth from Melanie at the beginning of this project.
This communication plan will be a roadmap on how the new division will best be able to communicate with Biotech’s corporate headquarters, suppliers, other divisions, and internally. This should lay out best practices and how the organization will be able to use the latest technologies available. Consider things as teleconferencing, video conferencing, telework, etc.
Instructions for completing Phase II of the Business Unit Strategy
Step 1: Write an Introduction Paragraph
Create the Introduction Paragraph
A well written management plan begins with a statement of the company’s goals for the project. This Introductory paragraph is the first paragraph of the plan and will be used to describe to the reader the intent of the paper. This intent should be understood prior to reading the remainder of the paper so the reader will understand the intent of the information.
Step 2: Write the Following Using the Specific Information Provided Above
- Description of the Organizational Structure
- Description of the Organizational Culture
- Breakdown of Products and Services
- Communication Plan
Step 3: Review the Paper
Read the paper to ensure all required elements are present. Use the grading rubric to ensure that you gain the most points possible for this assignment.
Proofread the paper for spelling and grammatical issues, and third person writing.
- Read the paper aloud as a first measure;
- Use the spell and grammar check in Word as a second measure;
- Have someone who has excellent English skills proof the paper;
- Consider submitting the memo to the Effective Writing Center (EWC). The EWC will provide 4-6 areas that may need improvement.
How to Set Up the Paper
Create a Word or Rich Text Format (RTF) document that is single-spaced, with double spaces between paragraphs. Use 12-point font. The final product will be 4-6 pages in length excluding the title page and reference page. Write clearly and concisely.
Completing the Project
In order to complete this project, you will want to first read the module, Learn How to Support What You Write, as this assignment requires you to use the course readings and research to support what you write. Also,
- Read the grading rubric for the project. Use the grading rubric while completing the project to ensure all requirements are met that will lead to the highest possible grade.
- Third person writing is required. Third person means that there are no words such as “I, me, my, we, or us” (first person writing), nor is there use of “you or your” (second person writing). If uncertain how to write in the third person, view this link: http://www.quickanddirtytips.com/education/grammar….
- Contractions are not used in business writing, so do not use them.
- Paraphrase and do not use direct quotation marks. Paraphrase means you do not use more than four consecutive words from a source document. Instead, put a passage from a source document into your own words and attribute the passage to the source document. Not using direct quotation marks means that there should be no passages with quotation marks and instead the source material is paraphrased as stated above. Note that a reference within a reference list cannot exist without an associated in-text citation and vice versa.
- Provide the page or paragraph number (required) when using in-text citations. If using the eBook, use Lumen Candela followed by the Section title and paragraph number.
- You are expected to use the case scenario, Biotech Company Profile, and weekly course material to develop the analysis and support the reasoning. The expectation is that you provide a robust use of the course material and demonstrate thorough research of the cosmetic industry. The only external source material used is in relation to the research on the cosmetic industry. Material used from a source document must be cited and referenced. A reference within a reference list cannot exist without an associated in-text citation and vice versa.
- Use a wide array of the course reading as well as sources from your research. The research should focus on information related to the cosmetic industry.
SECTIONS 1-3 PAPER FOUND BELOW:
Biotech Company is a company that operates in the health care. The health care industry or better known as the pharmaceutical industry caters to the health care products and needs of people. The company is built on products and services that make people healthy in the most natural of ways. The management of Biotech Company has decided to establish a new plant in Japan that will provide for beauty products to the residents. This project there is focused on conducting a company and environmental analysis to assess the company’s capability- both internally and externally, to survive in the new location. To access the internal as well as the internal factors that may affect the performance of the new division, strategic analysis using SWOT analysis, PESTLE analysis, and The Porter’s Five Force Model will be conducted in the line of the company’s goals and objectives.
Conducting a SWOT analysis is essential in determining the position Of Biotech Company in the market. The SWOT analysis will entail surveying and identifying the internal and external factors that impact the operations of the enterprise either directly or indirectly (Lee et al. 120). Strengths and weakness are classified as internal factors of the company in the cosmetic industry while opportunities and threats are the external factors that the company is subjected to in its operations. Analysis of Strengths illustrates the business competency and its ability to succeed in the market. It will also describe areas where the business may have a competitive edge over other similar enterprises operating in the same market. The analysis of both the internal and external factors that influences business enterprises will result in enhancing planning that in turn prepares the firm to get ready while entering the market at the appropriate time
There are various factors that make up the strength of the company. First, having effective leadership and management is a strength that the company boasts of. Having Michelle Constance as the manager of the plant is something that will enable the division to higher heights.Her qualifications, experience, and proven excellent managerial skills will be of importance in the formulation and evaluation of strategic plans. Her leadership skills will also be used as a bargain to attract development partners. The location of the division happens to be the other strength. Japan, offers the division with essay access to distribute and receive goods to and from the entire world. Other strengths include the presence of highly qualified and skilled staff is and presence of robust distribution channels that will help the division have a vast national as well as global presence across the world, offering natural and organic products that are eco-friendly and of high quality, continuous R & D and strong integrated marketing communication.
On the other hand, analysis of weaknesses would help the management of the division to identify the most critical areas that will require improvement. A precise assessment of weakness also will aid in the prevention and elimination of strategic blunders. Some of the weaknesses of the division include one, too many subdivisions: it will be a big challenge for the Biotech company in handling a new pool of employees and operations. Such large operations will always be faced with problems and issues. How they handle these problems will determine the success of the Division. Second, having the right pool of employees is a weakness for the Division. Even though there is the promise of affordable employees’ base, getting the right mix will be a challenge.
The first opportunity for the Division is the market potential. The personal care and beauty product market is on the rise. The Japan cosmetic market has the potential for growth in the coming years. With this, the Division will have a large customer base thereby expanding its revenue base. Product mix expansion is the other opportunity. In due time the Division may decide to venture not only in cosmetics but also in pharmaceutical products. The demand for organic products in the offers the division yet another opportunity. People have become sensitive to health products and want to use natural beauty products rather than the inorganic ones. Since this is one of the critical objectives of the firm, it will gain more customers by offering natural products.And lastly, the potential for partnership and acquisitions of other businesses with fast food chain is a big opportunity the company has to enable it to have a vast market base. However, the company faces threats which include changes in government policies which may result in the variable cost of compliance, rapid change in consumers/customers lifestyle and tastes and preferences. Indirect competition from companies such as Kao Corporation and Shiseido Company Ltd, cash crunch and the dynamic nature of the cosmetic industry.
The international business environment is full of opportunities as well as threats for the Biotech Health and Life Product Company to set up a new Division in a foreign country, Japan to be specific.Every international business has to take and face risks while trying to bring their product to a foreign nation. They have to be flexible with their business model because they are unfamiliar with the market and always be ready for abrupt changes in the new international market. A PESTEL analysis of the new Division will help the CEO understand the business risks and threats that the company will face while trying to bring their brand into the new location, Japan. A PESTEL analysis considers the external business factors that will affect a company either positively or negatively (Peng & Nunes, 2007). The Division will have to face new laws that they are not familiar with because the situation is not uniform all across the globe. There are no uniform legal or political situations across the world so the company will need to analyze the market and see how best it could adapt to the same. The following will be a PESTEL analysis of the Cosmetic industry in Japan highlighting the significant points that the company will consider before entering the new market.
Political factors constitute a significant threat to a brand opening internationally. The political climate of a country determines how the business will perform. Political stability is beneficial for a company and ensures that the business performs well while political turmoil has adverse effects on the business. Political instability would mean a lot of disruptions to many of the business vital supports that the business needs to be running smoothly. For example, political instability would involve disruption of the supply chain and distribution network in the business, therefore, cutting off the business from suppliers. The political climate in the Asian continent and specifically Japan, in this case, has been stable for the past couple of years hence explaining the economic success of the country. The state has no volatile political situations, so there is confidence in investing in the country. Moreover, the government attitude towards an international brand of environmentally friendly cosmetic products is a positive one.
Economic factors are the most important for a business because that’s why a company enters a market in the first place. The economic environment determines how will perform because it determines how the markets behave and how much the business will profit from the environment. Unlike the other industries, the cosmetic industry is resistant to economic. After the 2008 economic recession, most Asian countries including Japan has begun the Restoration and revival of their economies. Japan has been performing quite well since the restoration (Kumar, 1269) started and this offers a new opportunity for the Division to tap into the cosmetic
Social and cultural factors affect the businesses that investors want to venture into the international market. There is the need, therefore, to study the social and cultural environment of their potential market because it will affect how practical their impact on the market will be. The brands with the freshest and the trendiest products have a positive effect on the market, but at the same time, the business should be aware of the social image that it has in the country that they are going to venture into. Biotech Health and Life Products Company, for example, has innovative, efficient, and environment-friendly beauty products which they want to introduce to the Japan market. Japan being a pro-environment friendly country will embrace the products which the company is bringing into the country. Maintaining a right social image is essential because it galvanizes the popularity of the products and would improve the company’s business in the nation.
Customer convenience and safety are the most critical aspects of beauty products. That is why the Biotech Health and Life Company have placed eco-friendly and organic products as their priority. In this regard, the new division has ensured manufacture quality beauty products which are environment-friendly and cost-efficient. The technological aspect is crucial because the Division needs to be up to date with the latest technology for them to remain competitive in the market. Japan is a very technologically advanced nation which means that there will be a lot of competition even from the local beauty shops (Kumar, 1263). Nevertheless, the Division may edge these local beauty shops because the promised products are relative of higher quality compared to these local products and the fact that they are environment-friendly, safe and efficient, gives division an added advantage.
In the 21st century, environmental factors have grown in importance for business. Companies are investing highly in products with the least environmental impact if not zero impact on the environment. Eco-friendly products have grown in popularity. Japan being a country which is pro-environment will be interested in these kinds of products. The products offered by the division would attract a lot of customers in the market in Japan. These products also create a positive business image for improving the popularity of the business in the nation hence increasing market size and ultimately profits from sales.
Legal factors, in this case, involve the laws that the business will have to cope with once they tap into this market. This would include legislative issues such as consumer protection, health and safety laws, labor, environment, taxes, licensing regulations, and such Eikeland, & Skjærseth, 286). These laws determine how profitable business will be in an environment. In Japan, the focus is mostly on quality and safety that these foreign products present with their products. Legal issues can have a significant impact on the business affecting the business image and the profits of the company. For the Division to tap into the foreign market in India, it would have to comply with the legal standards that the country presents and maintain an ethical work environment.
Poster’s Five Forces Analysis
Most companies all over the world have in one way or the other utilized a strategic management tool known as Porters five forces model in their bid to analyze industry in which they operate. This tool will be of great help to the company in understanding the underlying forces of profitability in the cosmetic industry. Using Porter’s five forces model, the division will be able to maintain profitability as well as developing strategies for enhancing its competitive edge in the Japanese cosmetic market (Dobbs, 36).
The Threat of New Entrants
New entrants in the cosmetic industry influence the operations of the companies operating in the market (Dobbs, 36). Nevertheless, the threat of new entrants is weak due to the existence of other factors such as the enormous costs of capital to start a new business, substantial financial implications of starting new companies and the massive cost of new brand development. Through the analysis of new entrants, the company will be able to bring in innovations to provide a unique value proposition to customers, reduce cost, and lower their prices. All these strategies will be aimed to ensure the threat of new entrants in the industry is suppressed.
Supplier’s Bargaining Power
The market for cosmetic products in Japan is characterized by moderate supply and population. Majority of these suppliers have low forward integrating hence do not influence sell and distribution of their products to companies.Analysis of the bargaining power of suppliers, which is the second force of Porter’s model, will enable the company to build an efficient supply chain that entails numerous suppliers (Dobbs, 38). The company will also be able to develop dedicated suppliers who do not exploit them in any way.
Buyers Bargaining Power
Customers have a significant impact in influencing the market of cosmetic products. External factors that affect the power of customers in the market include the size of individual purchase which is moderate in nature, cheap substitute, and moderate switching costs. In this regard, a small change in customers demand has a significant implication on the cosmetic market. The company will have therefore to maximize customer satisfaction strategies. The analysis of the bargaining power of buyers will be of great significance to the company. Through this analysis, the company will be able to build a broad base of customers. It will also be able to develop new products. By doing this, the company will achieve loyal customers for its services and products.
Threats of Substitutes
By analyzing threats of substitute products or services, it will help the company to understand the core needs of other customers. They will also need to be able to increase the switching cost for the customers to obtain customer loyalty and suppress the threat.
Lastly, to beat the intense rivalry among the existing competitors in the cosmetic industry, the company will need to develop a sustainable differentiation strategy, collaborating with some competitors to increase the market size.
Goals and Objectives
The company is aware that for the new division to be successful in the new Japanese cosmetic market, it needs to have well-defined goals objectives. The goals are what the business needs to achieve within a specific period, i.e., general statements of what the company seeks to meet while the objectives provide the means or steps by which the goals will be achieved.Both objectives and goals will clarify the purpose of the business and help identify necessary actions. Goals and objectives need to be specific and measurable. The following is a breakdown of the particular goals that the Business Unit Strategy should seek to attain:
I.To maintain the integrity and image of the company’s brand: Integrity and image of the company’s brand refer to how the customers of the products perceive the company through its beauty products, image as well as the reputation. The company needs to place this as their priority because when the company loses its brand integrity, the company’s meaning in the market and its value to customers is lost.
II.To provide enhance customer satisfaction:The highest possible standard services to our customers. The customer is the most critical stakeholder in any given company. A company cannot exist with the customers.In this regard, the company is focused on creating a base of loyal customer that will move the company forward throughout its existence. When customers are not satisfied with the products and the services the company is offering, they have no option but to switch loyalty. Putting this in mind, the company will find ways to keep the customers satisfied.
III.To seek to be an employer of choice by attracting and retaining the highest caliber of staff: The human resource is the most valuable asset that the company can boast off. In the highly competitive industry like the cosmetic industry, the key to success for the company will highly rely on the performance of the human resource. The company, therefore, needs to serve employees need to bid to enhance productivity.
IV.To ensure the company achieves and maintains and grows adequate levels of profitability: ideally, the main reason why the company is in existence is to make profits. It is the core goal of the company to run a profitable operation. This typically means increasing revenue while limiting expense. The come any will focus on cutting costs so as the revenue base will grow. Any operating or activity that is not generating revenue for the company will be ignored.
V.To become more efficient business operation as a way to increase productivity: By attaining efficiency if means having the ability to avoid wasting materials, energy, efforts, money, and time in doing producing the desired business operations.
To achieve the first goal, building and maintaining brand integrity, the company will have to keep the following objectives in place: the company will seek to provide the customer with quality product that is organic and eco-friendly, to stick to the company’s values that are centered around honesty and integrity, making promises to customers and other stakeholders that are achievable, and Maintaining a consistent moral code.To achieve the second goal, customer satisfaction, the company will develop the highest possible standard services to the customers, increasing the customer service staff, and implementing a policy where customers are guaranteed constant feedback. Goal three will be achieved through the following objectives: implementing a training program to develop the skill set and abilities of the employees, create an employee compensation package with reward and recognition benefits, and improve employees working conditions. Goal four will be achieved through the following objectives: increasing annual sales by 10 percent, increasing turnover, and use pricing analytics that will aid in predicting what is likely to happen in the future and to set pricing strategy to counter the predictions. Goal four will be achieved through the following objectives: the human resource department will be focused to hire the right employees for specific positions, to employ technology in most of the business operations where necessary, and to provide the right tools and equipment for manufacturing purposes.
Fukubayashi, T. (2016). A History of Cosmetic and Drug Microbiology in Japan. In Cosmetic and Drug Microbiology (pp. 65-78). CRC Press.
Kumar, S. (2005). Exploratory analysis of global cosmetic industry: major players, technology and market trends. Technovation, 25(11), 1263-1272.
Okamoto, H. (2017). Japan. In Towards Industrial Democracy(pp. 190-239). Routledge.
Peng, G. C., & Nunes, M. (2007). Using PEST analysis as a tool for refining and focusing contexts forinformation systems research.
E. Dobbs, M. (2014). Guidelines for applying Porter’s five forces framework: a set of industry analysis templates. Competitiveness Review, 24(1), 32-45.
Eikeland, P. O., & Skjærseth, J. B. (2016). Comparative Analysis. In Corporate Responses to EU Emissions Trading (pp. 271-300). Routledge.
Lee, V. H., Ooi, K. B., Chong, A. Y. L., & Lin, B. (2015). A structural analysis of greening thesupplier, environmental performance and competitive advantage. Production Planning & Control, 26(2), 116-130.