Strategy of long term goals and objectives

Strategy of long term goals and objectivesStrategy is the determination of the native long term goals and objectives of the organization. It is the adoption of courses of action and the completelyocation of resources for carrying out these goals (Chandler, 1962). strategical purposening is very heavy factor for an organization. It is the process of determining a phoners long term goals and then detecting the best approach for put by means of those goals.1.1 Bangladesh fire crack Re-Rolling Mills LtdBangladesh brace Re-Rolling Mills Ltd. (BSRM) a social unit of tumefy cognise H. AKBERALI convention of Industries, having 50 years experience exclusively in spot name output, is fully automatic blade re-rolling pulverisation in the Bangladesh. The mill was imported from U.K. and commissi wizardd at the sea port of Chittagong. The initiator of the mathematical group was late Mr. Akberali A. Africawala and is now managed by his sons nephews. Bangladesh Re-rolling make Mills Limited (BSRM) was launch in 1960 and started to produce commerci on the wholey in 1961. The head office is find at Sadarghat, and it has factory at Bayazid Bostami road, Chittagong.Company slogan is Be Safe.The overlapion capacity is 20 metric ton per hour. The utilization rate is confining about 75%. Machineries choose been imported from England. BSRM is going to set up a different nerve factory at Fouzdarhat in Chittagong to work the increasing demand. The brand name of their produces is BSRM. It is an ISO certified manufacturing concern. It usually follows equal old bag pricing. They do non discriminate the prices of their products. Their annual promotional budget is Tk 15000000. The prices set forth between Tk 37500 to TK 39500. The margin per MT is Tk 2300. The revenue is Tk 11000000 per year. During the winter season, the demand for their products goes up.1.2 representationary station of BSRMThe Mission of the Company is to make spirit of the people sec ured and safety device by providing tone of voice products at a cheaper price and to be a confederate in the nation building activities.1.3 Vision of BSRM*Support the society through unified Social Responsibility initiatives*Maintaining leadership bunk in the make indus depict by producing the best prime(prenominal) sword products, continuously enhancing guest satisfaction and be approach shot a reliable vexation partner of their guest and suppliers.*Be an employer of choice, on focus on nursery and talent and developing future leaders of the organization.*Protect the interest of their copeholders throw sustainable emersion and value correction.*Preserve the trust of all of their s meshholders by adopting ethical backup practices.1.4 Core Organization ValuesSustainable Growth Steady feeler in the tonus of products and services, efficiency of processes and profitability of business.Quality Creating products and services determine by our customers consistently impro ving through innovation and adopting best practices.reliableness Be the preferred business associate of our customers and suppliers by offering feature products.Leadership Be a role model, setting benchmarks through our products, processes and people. guest Satisfaction Delight our outer and internal customers at every confront of our interaction with them by really netherstanding their needs, offering them our most elegant products and services.1.5 Goals and ObjectivesSupport the society through Corporate Social Responsibility initiatives.1.6 Stakeholders address holders and Sh atomic number 18 PercentageSponsor/Director 65.52%, Institute 11.7%, Public 22.78%SuppliersMeghna engineering Works Limited, Nasirabad I/A, Chittagong., DuferCo Asia PTE Limited, Singapore, Nortrade International Pte Limited- Australia, Maithan International, Mumbai, India, BGH Exim Limited Kolkata, India.CompetitorsRahim stigma Mills Limited, Kabir Steel Re-Rolling Mills Limited, Seema Steel Re-Rolling Mills Limited, Bashundara Steels.Board of DirectorsMr. Alihussain Akberali, Mr. Zohair Taherali, Mr. Aameir Alihussain, Mrs. Tehseen Zohair Taherali, Mrs. Sabeen Aameir, Mr. Qazi Sarwar-E-Alam. blasphemeersAgrani commit Ltd, NCC Bank Ltd, The metropolis Bank Ltd, AB Bank Ltd, Dhaka Bank Ltd, Prime Bank Ltd, The Trust Bank Ltd, Bank Alfalah Ltd, Eastern Bank Ltd, Pubali Bank Ltd , IFIC Bank Ltd, Uttara Bank Ltd, BRAC Bank Ltd, Mer tail endtile Bank Ltd, Standard Bank Ltd.1.7 Organogram of BSRM conformation 1.1 The present quick organisational structure of BSRMChapter 2Assignment split up 2Q.1. (i) An synopsis of the internal and external environment bear uponing the family supra.- Internal AnalysisBy victimisation the Internal analysis we scum bag find the organizations strength, ability, productivity and many others factors. Here Lewis 6 factors hire utilise for the analysis of the internal environment of BSRM. It is as followsManagement CapabilitiesBSRMs top attention members have mellow educational and professional qualifications a lot(prenominal) as MBA, CA, MS. In Bangladesh BSRM solicitude is the most experience and capable management in the steel application sector.MarketingBSRM has well established brand name and brand value in Bangladeshi commercialize. They have starchy media and communication class which uses effective and strong advertising techniques to reach to the people. Delivery and distribution is one of the most important factors to win and retain customer confidence. For smooth and barrack rake BSRM has already engaged several hundred dealers all everywhere the country. It has gross gross revenue and delivery depots in Dhaka, Sylhet, Bogra, Khulna, Moulvibazar and Comilla. harvest-festival and ServicesBSRM provides best quality products like Deformed Bar Xtreme 500W Yield Strength 72,500 psi (min), Grade-75 Wires, Angles, Channels, skip Steel Flats, let loose c arbon copy Wire Rods, etc. Company as well provides good services for his customers such as free product delivery service.Information Technology (IT)In recognition of the recent rapid harvest-tide of the alliance, the present IT facilities argon in the process of modification to meet the take onments of all the operating units and functional departments of the company. To ensure prompt and accurate information and information management, BSRM has decided to reconstitute total IT structure of the group. The maturation of this modification has already started. BSRM introducing integrated softw be encompassing sales and marting, production, accounts, stores etc to enhance the effectiveness of the company businesses.FinanceIn Dhaka stock ex transform, BSRM is one of the strong capitalised companies. Its annual turn everywhere is BDT 15,843,586,337. BSRMs Authorized working capital in BDT (Crore) is 200.00 and Paid up peachy in BDT (Crore) is 145.00. BSRM always maintain good fisc al and audit record. gentleman ResourcesBSRM has experience and professional workforce. Company provides excellent training and motivation course of study for the employees for better productivity and performance. In 2009 a few plans were put into regulate that bequeath signifi foottly revamp the companys Human Resource Management (HRM) capability. BSRM has appointed Price water house Coopers (PwC) one of the largest and reputed management consultancy firms in the atomic number 18a with the aim of change human resource management.External AnalysisFor analyzing the external environment of an organization PESTEL and Porters 5 forces analyze are used. Porters five forces embroil the supplier bargaining bureau, buyers bargaining power, threat of entry, threat of substitute and emulous rivalry (Robert, 2008). The Porters Five Forces model is a straightforward tool that supports strategic view where power lies in a trade condition.Threats of New EntrantsCapital Requirement Ste el business is an investment precise business sector. already BSRM has invested large amount of capital in steel sector.Government indemnity BSRM is an old company and its Corporate Social accountability already enjoys a reputable position in front of the Bangladesh Government.Differentiation of product Steel has very small barriers in terms of product differentiation as it does not fall into the magnificence or specialty goods and thus does not have any bulky price variation. However, BSRM still enjoy a premium for their products because of its quality and its brand value. BSRM has introduced brands like BSRM Xtreme 500W, BSRM Grade-75 Wires, BSRM Angles, BSRM Spring Steel Flats. ambition AnalysisOne commonly used tightfistedness ratio is the foursome-firm concentration ratio, which consists of the grocery store partake, as a percentage, of the four largest firms in the industry. All the major(ip) domestic competitors like KSRM, Rahim Steel Ltd., PHP, Bashundhara have announ ced massive elaboration plans recently.Bargaining Power of SuppliersGlobally, the top three mining giants BHP Billiton, CVRD and Rio Tinto supply to a greater extent than or less two-thirds of the processed iron ore to steel mills and command very naughty bargaining power. In order to safeguard itself from the high bargaining power of the suppliers, BSRM has forayed much earlier into the scheme of Backward Integration.Threat of SubstitutesPlastics and composites create a threat to BSRM in one of its titanicgest foodstuff. Perhaps the main beautiful substitute of stainless is aluminium. Steel has already been replaced in some huge event applications large diameter water pipes (RCC pipes), railway sleepers (RCC sleepers), small diameter pipes (PVC pipes), and domestic water tanks (PVC tanks).Bargaining Power of BuyersSome of the major steel breathing in fields like gas, oil and automobile, shipping, consumer power and durables generation have the advantage of high bargaining p ower and get smart deals.Q.1. (ii) soon state any major changes took place based on the affect of external environment. BSRM has launched pertly product named BSRM Xtreme 500W in 2008 due to the hard disputation in steel sector in Bangladesh. Competition among the competitors is one of the important external environmental factors.In Bangladesh there are many big steel industries tally their operation. All the major domestic competitors like KSRM, Rahim Steel Ltd., PHP, Bashundhara try to achieve the higher position in this field by produce refreshful products. Nowadays mental synthesis activities are increasing to a greater extent than any time ever. Bangladesh is not separate from this emersion. For buildings, bridges, household instruments, etc. pull steel is essential product.The increasing demand of steel, produce hard aspiration among the existing steel industries in Bangladesh. BSRM always try to give reinvigorated, safe quality products and services for their customers. By this way BSRM attract juvenile customers and try to beat their competitors.At present everyone using high quality steel bar for the construction purposes. BSRM Xtream 500W bars make a tremendous change in Bangladeshi steel sector and make BSRM the leader in steel industry.Q.2. Review the existing business plan of the chosen company and review the warlike position and current business dodging. Current line of products Strategy of BSRMBSRM has developed its scheme for the future suppuration of the company. By applying the merchandise oriented scheme BSRM try to attract more customers. At present, BSRM has launched spick-and-span products in the foodstuff named BSRM Xtreme 500W. The company already booked many construction material supply orders from the corporate customers. Price reduction dodging is another(prenominal) strategy they have already started to apply. The company has already appointed more than 100 dealers and agents all over the country to supply their products and services to their customers. By providing high quality products and customer services BSRM try to add their sales and profits. This is the current business strategy of BSRM.Current Business Plan of BSRMFor make up the production capacity by 33% from the present capacity of 375,000 dozens/year to 500,000 tons/year BSRM has taken some actions. The next plan of BSRM is, they bequeath spend about Tk. 650,000,000 for the expansion of the company. By retained wages and partially by term loans from the banks, BSRM will finance their business target. For the un-interrupted crank material supply BSRM group has established a new company named BSRM Iron Steel Co Limited (BISCO). BSRM Steels Ltd. will acquire 95% stake in BISCO for strategic reasons and increase competitive position of our Company. competitive Position of BSRMVarious models and strategies house be used to review the comp etitive position of a company such as Boston Consulting meeting Matrix, Industry Life Cycle and Strategy clock etc. I am going to analyse the competitive position of BSRM by using Boston Consulting Group Matrix (BCG) and Industry Life Cycle.Boston Consulting Group MatrixIt is classified all companies strategic business unit correspond to the growth rate and grocery percentage (Kotler, 2008). high relative market shareLow relative market share laid-back market growth rateStarsQuestion marksLow market growth rateCash cowsDogs practice 2.1 BCG Matrix chartThe above chart showing four different level of competitive position.Stars High market share high market growth.Question mark Low market share high market growth.Cash cows High market share low market growth.Dogs Low market share low market growth. consort to this Boston Consulting Group Matrix analysis BSRM is in the position of star because it has about 50% market share in the steel industry. BSRM is number one steel industr y in Bangladesh. BSRM earned net profit of Tk. 574.08 million in 2009. Gross good as well as increases Tk. 271,922,738 from the previous year. So it shows the high market share and high growth rate.Industry Life CycleBSRMFigure 2.2 Industry life cycle chartThe industry life cycle is an important extension of the growth of a company. The different tiers of an industry life cycle are introduction, growth, maturity, and decline. Sales normally start gradually at the introduction act and then lift-off continuously throughout the growth period. After the maturity stage, sales then start a regular decline. Basically, profits usually running to rise during the life cycle.An industry start its journey or graduation from the introduction phase of the life cycle. Perhaps a fresh and incomparable product offering has been developed and patented, thus beginning a new industry. Significant amount of capital required in the growth stage of an industry like the introduction stage. The indus try is experiencing more product standardisation at this stage. When the industry begins its expansion into maturity stage the curve looks flat. This indicates bleak growth of the industry. Some experts place another stage between growth and maturity, called expansion. Declines are almost expected in an industry. If product improvement has not kept speed with other competing products and if new innovations or technological changes have caused the industry to become obsolete, sales suffer and the life cycle experiences a decline. In this stage, sales are falling at very immobile rate.According to the human body 2.2 of industry life cycle, the competitive position of BSRM is in maturity stage. BSRM has already passed its introduction and growth level. Now it has a brand name and value in Bangladeshi steel market. BSRM has very strong customer backup. Now in this mature stage, it has to introduce new strategy to increase its growth.Q.3. Identify and evaluation of alternative strate gies that would consist of companys goals and objectives and select an withdraw future new strategy. According to the previous analysis of the existing position of BSRM I can suggest a possible alternative strategy under ANSOFF hyaloplasm. ANSOFF matrix is a popular method among the organizations business practices. ANSOFF matrix (Product market expansion grid) represents four potential options which are shown in the figure below.ANSOFF Matrix (Product-Market Expansion Grid)Figure 3.1 ANSOFF Matrix (Product-Market Expansion Grid) layout.Market brainstormMarket penetration is the name given to a growth strategy where the business focuses on selling existing products into existing markets.Market maturementMarket tuition is the name given to a growth strategy where the business seeks to sell its existing products into new markets.Product developmentProduct development is the name given to a growth strategy where a business aims to introduce new products into existin g markets. This strategy may require the development of new competencies and requires the business to develop modified products which can charm to existing markets.DiversificationDiversification is the name given to the growth strategy where a business markets new products in new markets. This is an inherently more risk strategy because the business is moving into markets in which it has little or no experience.Here two alternative strategies I can mention. They are Market development and product development. Let us evaluate some(prenominal) strategies related to the BSRM.Market DevelopmentSuitabilityBSRM can increase their market coverage through the market development strategy. By applying market development BSRM can increase its sales growth rate. If they increase their sales simply they can profit. thither are some areas in Bangladesh which are in under development process. Many constructions activities are running all over the country. So, it can be a good chance for BSRM to increase their market growth.According to BSRMs vision and relegating statement it has mentioned to provide high quality steel products to the customer and become market leader in steel industry sector. Market development can support BSRM to achieve their mission and vision. So this is a desirable strategy to BSRM.acceptabilityBSRM is the leading steel industry in Bangladesh and they have brand name. People undoubtedly retrieve their products. BSRM always honestly work for their customers, shareholders. So, in capital market it has a positive reaction. Currently government spending large amount of bullion in the industry sector for the development of current economical condition. So, this is an gratifying strategy.FeasibilityAccording to the cash flow statement BSRM has good fiscal ability in market. In the date of 31st March, 2008 BSRMs share gold deposit was BDT 6,015,000 and Liability against import was BDT 169,597,618. It has the largest work force and experience manageme nt team. BSRM has good annual balance and cash flow statement. Their stock market shares are similarly strong valued. BSRM has fiscal capability to seek on the market. So this strategy is also feasible.Product developmentSuitabilityBangladesh Steel Re-Rolling Mills Ltd. currently produces steel related products and services. It has good market share as mentioned. BSRM can use product development strategy for their market growth. Peoples experience and perceptions are always changing. So customers prefer to experience new product. Generally they like new products with high value and low price. BSRM can produce new products and can improve their customer relation facilities. alike they can improve their current product by using new technological instruments and machines. It has already create and maintain a well known brand name so, that will help to marketing the new product. to a fault BSRM created brand and customer loyalty so this strategy is appropriate to BSRM.Acceptability u se the industry life cycle analysis it is clear that BSRM coming under the maturity stage. Therefore, product development is acceptable in this stage. It will help to achieve the profit growth. by the product development it can ensure the profit and success. In the steel business field changes are important to progress in the market. For an example TESCO has introduced TESCO lemon drinks, TESCO sugar, etc. issue lemon drinks and sugar is product development strategy for the company. It is not a completely new product it is a modified product. By Using these types of strategy TESCO try to increase their market growth. So this strategy is also acceptable for BSRM.FeasibilityThrough the financial statement BSRM has established their financial resource. They have strong financial background and stability in the market. optimum level of financial resources helps BSRM to support the product development strategy. As a steel industry BSRM has the financial, human, technology and physical resource. Favourable and good cash flow statement shown in the financial statement. Therefore this strategy is also feasible to Sri Lanka Telecom.According to the evaluation of the alternative strategy analysis I can recommend that product development strategy is the most suitable strategy than the market development. There are many opportunities for BSRM to enter into the new market. BSRM already has the brand name. So it is the chance for BSRM to consume the product development strategy.Q.4. Construct a new suitable structure for a strategy plan ensuring the participation of all stakeholders. New Organizational StructureFigure 4.1 Proposed New Organizational Structure of BSRMUnder the every divisional chief executive officer the structure will be same for GM to the bottom line. It is a common practice that when an organization changes their strategy it requires to change of the organizational structure. There are four major types of organizational structure used which are divisional structure, functional structure, matrix structure, strategic business unit structure. According to the new strategy of BSRM I have proposed a new organizational structure. The new structure is the divisional form of organizational structure.Product development is the new strategy I have recommended for BSRM. So, I have restructured the existing structure. I have added six divisional CEO for the company consort to my new strategy product development. One CEO cannot check all of the part of Bangladesh so I have introduced the others. I have include another manager who is product research and development manager under the Sr. Manager Marketing Sales.In this structure product research and development manager is an important post. His job will be the product research and find out the market opportunity which BSRM can weapon into their product development strategy.Q.5. Analyse how you would plan for the effectuation of strategy in the perspective of following issue. Strategic PlanStrategic plan is a set of statements describing the purpose and ethical conduct for an organization together with the specific strategies designed to achieve the targets set for each of these. The strategic plan can be arranged by analysing the internal and external factors which have control over the company.There are some major points involved in strategic planning. They are as follows-Defining corporate mission backing corporate objectives and goalsDesigning the business portfolioDesigning the key business unit strategyFunctional plan.BSRM strategy plans accordingly the above steps.Corporate missionBecome a market leader of Bangladesh in steel industry sector by providing a good and high quality products and services.Corporate objectivesMaintain leadership position in the steel industry sector. earmark high quality products and services with affordable price.Achieving the target profit growthIncrease the market share.Business portfolioBSRM produce steel related products such as Deformed Bar Xtreme 500W, Grade-75 Wires, Angles, Channels, Spring Steel Flats, Low Carbon Wire Rods, etc.Business unit strategyTo achieve its objectives product development is the BSRMs business unit strategy.Functional strategyTo support the business strategy, BSRM has developed many promotional strategies. BSRM select the Chittagong and Dhaka division to increase its market area.Strategy can be reach through cost reduction, improved quality of product and services, through the development of customer taste sensation and the raise of competitive leverage (Henry et al, 2003).Resource RequirementsThe resources are essential exigency to implement the strategy of the business. For the performance of strategy there are four mail resources required. They are financial resources, physical resources, human resources and technological resources.Through the financial statement BSRM has es tablished their financial resource. They have strong financial background and stability in the market. Technological resource is very much related to the steel industry sector. In 2008 a state-of-the-art DANIELI build rolling mill BSRM Steels for manufacture the highest grade bar available in Bangladesh. So BSRM adopt new technology to deliver good and quality products to his customer. BSRM has appointed PricewaterhouseCoopers (PwC) one of the largest and reputed management consultancy firms in the world with the aim of strengthening human resource management. BSRM has highly skilled labours and also has physical resources to implement the strategy. BSRM needs to acquire these resources effectively to support their objectives goals.Targets and timescalesTimescale is one of the main facts for the implementation of strategy. If time target is fixed then the strategy control will be easy. BSRM always try to set a target timescales for the implementation of their strategy. By followin g the new strategy, BSRM has set a five years timescale to achieve their corporate objectives. The company has to do some research into the market condition and has to improve technical and distribution side. So it will take 5 years time period to achieve BSRMs new strategy.