Sustainable Solutions for Albani Corporation - Essay Example

? Sustainable Solutions Paper DBA Strategy Sustainable Solutions Paper The changing business climate resulting from application of information and technology is a significant aspect that determines sustainability of modern businesses. This has enabled firms to make smart decisions and enhance efficiency in their business operations. Albani Corporation is a successful business in supply chain that has been involved with the production and distribution of perfumes and cosmetics. In this context, the aspect of sustainability is in relation to the external and internal business environment (Senge, 2008). As a business that deals with fashion and lifestyle products, Albani is concerned with sustainability of its customers and suppliers. Being a leading company in the perfume industry, Albani can be ranked as a successful or unsuccessful company through considerable consideration of its business environment. This will require the use of appropriate and up to date business analysis tools including porter’s five forces, general force analysis tools, SWOT analysis, and detailed value analysis. Sustainable operations will only result from strategic thinking and planning by the company’s managers. In the strategic planning, the company will require addressing both its production and supply channels. Executive Summary Sustainability of a business depends on various factors. These factors are fundamental characteristic of the business environment in which a firm operates. The sustainable solution paper analyzes the immediate environment of Albani Corporation. The paper also analyzes the future of the company in terms of sustainability of its strategies and business structures. The sustainable solution paper begins by looking at the internal environment of the company. Internal business environment include immediate business factors controlled by the business. Such factors define the weakness and the strength of the company in relation to its competitors. Secondly, the paper analyzes the external environment of the company. Through the analysis, the paper utilizes essential industry analysis tools, which include SWOT/ SCOT analysis, landscape analysis, Boid analysis, Value Chain Analysis. Based on the above industrial and business analysis tool, the paper gives a long tern focus on the future of the market and industry in which Albani company operates (Alas, 2007). This focus or prediction is based on strategies derived from each of the analysis. General Force Analysis: the company is subject to economic forces that affects people’s purchasing power and way of life. Technology determines the production capacity and quality of the products that the company produces. Finally, consumption of Albani products is based on demographic factors such as gender ratios and dependency ratio it was established that the company targets people aged between 15- 40 years of age. Porter’s Five-Force Analysis Power of buyers: Buyers in the perfume industry have relatively low power and hence a low effect on the prices of the products Bargaining power of suppliers: The industry has few suppliers and hence they have high powers or ability to control the market and profitability of firms. Threats of substitutes: the industry has greatly differentiated products and hence minimal threats of substitutes. SWOT Analysis Strengths: Strong brand and Wide customer base are the main strengths of the company. Weakness: Using its positive values or strength the company hopes to eliminate its weakness, which includes Stretching demand and requirements for summer fragrances. Opportunity: By utilizing its strengths, the company hopes to exploits its opportunities, which include Emerging markets, winter fragrances. Threats: Finally, the company can counter its threatening factors by eliminating its weakness, which includes influx of cheap products, and Changing trends and fashion. Fitness Landscape and Analysis The perfume industry is a dynamic industry that is expanding constantly. However, the company is not reciprocating the dynamism of the market. The risk factor resulting from intensive changes within a company’s operation is the main factor hindering its growth. Boid Analysis The company is over reliant on its well-established brand name. Although this is beneficial to the company in the short term, it lacks long-term sustainability. This is because the company’s brand name lacks sufficient impact on the younger generation. Life Cycle Assessment The company’s product s has insignificant impact on the environment. However, byproducts of perfumes and other beauty products produced by the company have long-term implication on the environment. Compliance to Innovation Analysis The company has a fair compliance with technological innovations since it has an automated marketing system and modern platforms of sales promotion and advertisement. Summary Focus Albani Company is a successful company in the perfume industry. The company has an extensive production and marketing networks, which covers most of European and American markets. Stakeholder for this organization includes customers, suppliers, governments and business partners. Economic trends of interest that determines the firm’s production and business includes economic booms and recessions (Concoran, & Silander, 2009). Each of the different economic phases has significant impact on the market. The company specializes on perfumes, which are not part of basic commodities or human requirements. This indicates that the market is subject to economic fluctuations and trends. Albani has a strong brand and extensive influence of the market (Albani, 2012). This stands out as the main strength of the company. Despite its strengths, the company is struggling with inability to meet increased demands during the peak season. In addition, the company lacks products that meet the requirements of the younger generations. This makes the company to be over reliant on a diminishing market. In order to exploit its immediate opportunities the company needs to set strategies that would capitalize on its strengths in order to tackle subsequent weaknesses (Rokeach, 2003). Key Takeaways The dynamic nature of the fashion industry is the main factor that the company needs to consider in order to have sustainable operations. To counter the effects of the shifting market, the company should produce products that are in line with market demands. The managers need to conduct intensive and extensive market research to establish precise requirements of customers in the perfume industry. Integration of Concepts The core objective of the paper was to analyze the sustainability of Albani business in relation to its business environment. Sustainability analysis is based on strategies derived from market and industrial analyses. Sustainability of business strategies is based on the vision and objectives of the business. Thus, Albani corporation need to set business strategies that reflects it mission and business objectives. The main mission of the company is to achieve customer satisfaction based on production of competitive products. Albani is a firm in the fashion industry and, therefore it should have a high degree of compliance with innovations. Innovation compliance is related to the SWOT and scot analysis and provides directions to the landscape analysis. The theory sets objectives that are achievable through sustainable developments and strategies in the company’s marketing and production structures. Stakeholder Identification and Value Analysis -Part I Stakeholders refer to organization, persons, or groups of persons who may be affected by a company’s decision. Customers are the main stakeholders of the company. This is because the company has a responsibility of meeting their perfume and fragrance requirements. Thus, any decision made by the company concerning the nature of the product is likely to affect the customers. The customers define the corporate-level strategy of the company. This is because customer’s satisfaction indicates `Albani’s main business. Enterprise Level Strategy Business-level strategy is a significant enterprise level strategy. This strategy defines the company’s competitiveness and sustainability in the perfume industry. The company’s employees have contributed to the company’s sustainability through the creation of high quality products. The company’s lenders and promoters have also contributed to the company’s growth and sustainability by ensuring that the company has sufficient capital. The core competence of Albani business is based on customer satisfaction. This indicates that its business strategies focus on identifying the main customers of the business and the reasons for their satisfaction. Identifying the demographical implication on the business is also a core element of the business strategies of the company. Currently Albani focuses on the adult products although it has plans of producing products that match with the requirements of people from other age groups. Culture Type Organization’s cultures are values that bind each member of the organization with its core mission and objectives. Organization culture is the element that identifies Albani with its customers, staff, promoter and other stakeholders. Albani Company has a culture of excellence in production of quality perfumes and beauty products. According to Macmillan (2007), Albani’s organizational culture can be classified as The Company’s decisions have a major impact on its customers. Thus, big decisions are taken after considering the views of all the stakeholders. For instance changing the name or scent of a particular perfume will require the approval of the customers and other relevant stakeholders. Such decisions require extensive and intensive market research. Integrated Concepts from Readings From the previous readings, the success a company’s success depends on various factors. Each of these factors has a role to play in determining the overall nature of the company’s external or internal environment. The enterprise level strategies define the role of the business and its perception according to the society. Thus, enterprise strategies are concerned with the corporate social responsibility of the business. The company’s culture and enterprise strategies are congruent despite not been closely related. Evidence and Implications Albani Company has well established domestic markets and distribution channels. In addition, the company has gained well-established channels through from where it gets its supplies and raw materials needed in the dairy industry. Although the company has a good influence of the local market, the company reorganizes the need to offer quality product to its customers and therefore it consider the production of quality products as its main objective and mission. General Force Analysis: External – Remote Environment The general force analysis is a business an analysis tool that focuses on the overall effects of business strategies in relation to its environment. General force analysis captures the overall concepts of key business analysis tools such as SWOT analysis. General forces relate to the society and the country’s economy towards the business (Macmillan, 2007). From the company’s perspective, the society is divided into customers, non-customers and potential customers. The country’s economy also plays a significant role determining the company’s progress. Secondly, the demand for the company’s products is influenced by the people’s culture. General Force Matrix Analysis According to Pearce and Robinson (2003), there are five categories of forces in the external environment: economics, demographics / social / culture, government. Although the company is not a direct subject of economy, economic pressures affect its influence in the highly competitive market. Technology: the external and internal environment of the company is dependent on its ability to utilize available technology. Its production line and communication networks rely on appropriate use of technology. Its highly interactive website is a sufficient indicator of the business compliance with technology. Finally, Albani’s products are subject to government’s control and policies. This influences the company’s objectives and decision-making. Implications of General Forces According to the general force analysis, the company needs to utilize its business advantage to increase its sustainability in the industry. Currently the company is not utilizing all its business advantages and this contributes to its slowed growth. For instance, the company is over dependent on its strong brand to dominate European and American markets. However, its brand does not have sufficient influence on the international market. The general force analysis also indicates the significance of economic fluctuations of the company’s products and the market. The company seems to neglect the potentials of products for young children and teenagers. Threats: The perfume industry is increasingly becoming a liberalized market. Entry of new products from developing economies threatens the company’s existence and markets. Secondly, the company is experiencing underproduction during the peak period. Inability to meet market demand during the peak season affects its long-term sustainability. Opportunities: The growing demand for Albani products is a significant opportunity. In addition Albani products have an opportunity of been tried in new and upcoming markets. Lastly, the company needs to utilize its strong brand name as a source of its competitive advantage. Fitness Landscape Analysis Description of Fitness Landscape and Analysis Landscape analysis is a detailed study of a potential business opportunity with the aims of establishing its viability. Businesses are also interested in analyzing the similarity between their business models and actual business situation. Landscape analysis theories relate the risks involved with making a drastic change in a business and the related benefits (Boar, 2001). Despite the risks, businesses are optimistic that changes within their structure will have beneficial results. The perfume industry is a dynamic industry that is expanding constantly. However, the company is not reciprocating the dynamism of the market. The risk factor resulting from intensive changes within a company’s operation is the main factor hindering its growth (Lawrence, 2005). The conservative nature of the market is the main factor that is discouraging the company from adopting appropriate changes in its structure. The perfume industry will experience constant growth in the next twenty years. However, the growth will not be visible in all sectors of the industry. For instance, the market will not grow proportionately as the production. This is because buyers in the market are not flexible about new products. However, usage of perfume and beauty products is likely to increase considerably due to the increasing market demands and lifestyle changes. Secondly, the target market for Albani has an aging generation. This is likely to lower the market threshold for perfumes and beauty products. Production is likely to increase due to efficiency resulting from application of technology. In addition, the company is expecting considerable growth in it s markets due to application of information technology. Implications of Analysis The landscape analysis results indicate that Albani needs to restructure its operations in order to achieve sustainability. In this case restructuring of the business will involve targeting the appropriate customers. Due to the current demographic factors, the company should focus on the older generation by producing products that fits their preference. Boid Analysis The perfume industry is a highly conservative industry that operates under rigid rules. Success in the industry requires companies to be compliant with trends and fashions. In addition, the industry is highly dynamic. This implies that firms operating in the industry require having a high degree of compliance with trends and fashion. In addition, the perfume industry is subject to technology in a number of ways. Firstly, efficient production of products requires the company to have a high degree of compliance with current technology. In addition, packaging of resultant products requires having an element of compliance with technology. From the company’s operation strategies, it is evident that the company is over reliant on its well-established brand name. Although this is beneficial to the company in the short term, it lacks long-term sustainability (Kerr, 2004). This results from lack of popularity with the younger generation who represents the upcoming markets. Changing the company’s brand name or producing Albani’s products under a famous record or label trend would require precise application of landscape analysis results. The company should also learn effective strategies from other operators in the industry. Implications of Analysis From the analysis, Albani Company seems to be having unsustainable operations. The results indicate a form of challenge that Albani’s managers need to take. The company is currently struggling with short-term sustainability objectives. Thus, the company should be dealing with long-term strategies that are aimed at ensuring its sustainability in the perfume industry. Long-term marketing strategies defy the company’s traditional thinking and market structures. Industry Evolution Modeling Industry Evolution Modeling Description and Analysis “Life in the universe, and perhaps life in organizations, arises from dialectic between competition and co-operation, not from unconstrained competition” (Stacey, 2007, p. 203). This statement is among the classical results of Ray’s experiment. According to the statement, cooperation and competition are significant aspects of business sustainability and success. Industries are subject to changes that result from internal or external structures of firms. Sustainability of a business depends on its ability to adopt or take advantage of the industries evolutions (Boar, 2001). This statement is analogous to Allen’s Fishing Experiment Findings. In the real business model, evolution of businesses will necessitate mergers and take-over, which would be effective to Albani’s case. On the other hand, the company needs to cope with stiff competition that characterizes the industry. Industrial analysis using both concepts demonstrates the actual status of the market (Hoffman, 2009). This is because the company is faced with the dilemma of competition and corporation with other firms producing similar or related products. Cooperation with other players in the industry can be a disguised element of competition and hence a long term sustainability strategy. Mergers and product standardization are some of the significant aspects that the company can apply to comply with the industry’s growth (Macmillan, 2007). Implications of Analysis Industrial analysis is established on the findings of landscape analysis. Landscape analysis evaluates evaluate the viability of opportunities and the ability of a business to transform its threats into opportunities. On the other hand, industrial analysis evaluates the real implication of opportunities in terms of competition and corporations. The theory challenges the firm to increase its corporation with other players in the industry as a strategy of improving its performance and long-term sustainability. Life Cycle Assessment Lifecycle analysis also referred to as cradle-to-grave analysis is an analysis technique that evaluates the impacts of the products of a company from production to consumption and disposal stages through their manufacturing. This analysis is becoming increasingly significant in the modern highly dynamic and fragile economies. Life cycle analysis analyzes the implication of company products to the environment from their extraction to their disposal through their consumption (Smith, 2003). LCA Modeling Description and Analysis Albani Company produces a variety of perfume products under the men and women category. Most of Albani’s products have an ordinary life cycle. For instance, the brand “Passenger Lady Perfume” has a three-phase life cycle, which includes extraction, manufacturing, consumption and disposal. The main raw material is extracted from a variety of flowers in form of soluble oils. Other significant raw materials include solvents such as benzene gas and petroleum ether. The by-products are realized during the usage of the product in form of volatile gases and alcohol vapor and the packaging containers. Implications of Analysis Although Albani’s products have insignificant impacts on the environment, the products have cumulative and long-term impacts on the environment. Therefore, the company requires long-term strategies to deal with environmental impacts of its products. In addition, the company will to research on production processes that require raw materials with minimal impacts on the environment (Fieschi, & Lancon, 2010). The company also needs to ensure that its products comply with the relevant international standards. The impacts o f the company’s product to the society is also a factor of consideration. Compliance to Innovation Analysis Sustainability of businesses in the modern competitive business environment depends on their compliance with innovation. Compliance with innovation relates to all aspects of modern business environment such as information technology and automated production and sales systems. Innovations are appropriate solutions to problems facing businesses in the modern business environment (Garland, 2007). According to the SWOT analysis results, Albani is experiencing difficulties that are related to production and distribution of its commodities. Complying with information and communication technology will provide appropriate solutions to the current problems facing the company. In addition, the automated marketing system is an indicator of the company’s compliance with technology (Burke, 2010). However, the company has issues with its production units that require technology and innovation solutions. Implications of Analysis Compliance with innovation is a significant aspect of business sustainability. Been a firm in the fashion industry implies that Albani should have a high degree of compliance with innovation. Compliance with innovation is related to the SWOT analysis and provides guidelines to the landscape analysis (Boar, 2001). The theory is set on long-term objectives that define the company’s sustainability. The ability of the company to achieve such goals determines its compliance with innovations. Sustainable Value Framework Analysis Sustainability is a disguised challenge that affects all the firms in a given industry. On the other hand, opportunities and threats are dynamic elements. The company will therefore need to take advantage of opportunities and transform its threats into opportunities. “To be recognized as global business partner and key player in the supply chain that manage cost and pursue continuous improvement of products is a significant value analysis framework’ network” (Werner, 2011). This is the Werner’s version of sustainable framework. Werner considers businesses to have a mission, which is embedded in their vision and values. His version considers delivering of values to customers, shareholders and business partners as the core mission of Albani Company. Albani’s main goal is to fulfill its vision and mission based on its value added services. This is a significant method of enhancing business sustainability through growth and efficient business operations. Albani’s framework is creating sustainable business based on the four quadrants. In addition the company’s business strategies should be based on it s current and future business requirements. The lower left quadrant in the sustainable value framework plan deals with the immediate business environment. Albani’s strategies are to have an extensive marketing framework and capabilities of exploiting the future and current markets. The company’s strategy is to have sales representatives in the new and existing markets. The company also needs to improve its customer services and points of customer interface. The next quadrant (lower-right quadrant) is concerned with external factors that affect immediate operations of the business. Albani needs to establish a concrete relationship with its stakeholders through collaboration and having transparent goals. Transparency with stakeholders will enhance reputation of the company’s products (Shaw, 2006). The third quadrant considers internal operations of the business in relation to the future expectations of the industry. The current market lacks product leadership and product integration. The fourth quadrant is concerned with sustainability in the larger market. Albani’s management should plan an open forum with all of its stakeholders. Through the open forum, the management should device a long-term plan that will enhance the company’s sustainability in the perfume industry. Sustainable Value Framework Tomorrow Today External Marketing networks profits Cooperation reduced expenses Internal Technology efficiency advertisement concrete customer base Argument in Support of Conclusions Albani Corporation has had constant growth in the past years. Currently the company is among the market leaders in the perfume industry. Its market leadership is based on its market share and increasing demand for its products. The current path of constant growth is the main indicator of the company’s sustainability. Despite the constant growth, the company needs to be aware of its future in relation to developments in the industry (Triandis, 2008). The company’s management team is constantly exploring new ideas and success strategies in the constantly changing industry. Implications of Analysis From the analysis, it is evident that the company has variety of challenges. Transforming these challenges into opportunities is the basis for the company’s success and sustainability in the perfume industry. The company needs to restructure its production system to ensure consistency and sustainability of its markets. Conclusions Albani is a successful firm in the perfume industry. Despite its success, the company is faced with sustainability challenges. Thus, the company needs to utilize its opportunities in order to solve its challenges. Immediate challenges facing the company include underproduction and highly shifting markets. The company needs to harmonize its production with the market requirements as a sustainability strategy. Results of the market and industrial analysis indicate that the company is experiencing uncertainty in its growth and long-term projections. Utilizing the recommendation of relevant business analysis will provide appropriate for immediate and future problems. References Albani. (2012). “Albani Corp”. Retrieved from http://albanicorp.com/ Alas, R. (2007). Organizational Change from Learning Perspective. Problems and Perspectives in Management, 5(2). Boar, B. (2001). The art of strategic planning for information technology, 2nd ed. New York, NY: John Wiley & Sons. Burke, W. (2010). Organization Change: Theory and Practice. London: SAGE. Concoran, T. & Silander, M. (2009). Instruction in high schools: The evidence and the challenge. Future of Children, 19, 157-183. Fieschi, M., & Lancon, C. (2010). Implementing Electronic Medical Records in a Psychiatric Hospital: A Qualitative Study. International Journal of Psychiatry in Clinical Practice, 14(3), 223-227. Doi: 10.3109/13651501003717243 Garland, E. (2007). Future inc.: How business can anticipate and profit from what’s next. New York, NY: AMACON. Glenn, J. C., & Gordon, T. J. (2009). 2009 State of the future. Washington, DC: The Millennium Project. Hoffman, K. (2009). Who do we blame when it all go wrong? Quality and Safety Health Care. 18: 3-4. Kerr, S. (2004). Introduction: Preparing people to lead. Academy of Management Executive, 18(2), 118-120. Lawrence, A. (2005). Business and society: Stakeholders, ethics, public policy. 11th Edition. Boston: McGraw-Hill. Macmillan, T. (2007). Strategic Management. London: Oxford University Press. Marks and Spencer Financial Statements 2011, viewed June 13, 2012, Pearce, J. A., & Robinson, R. B. (2003). Strategic management: Formulation, implementation, and control. Boston, MA: McGraw-Hill. Rokeach, M (2003). The nature of human values. New York: Free Press, Senge, P. (2008). The Necessary Revolution: How Individuals And Organization Are Working Together To Create A Sustainable World. London: Doubleday. Shaw, J. (2006). A cognitive categorization model for the study of intercultural management. Academy of Management Review, 15(4), 626-645. Smith, R. (2003). Great answers to tough marketing questions. New Delhi: Kogan Page Publishers. Stacey, R. D. (2007). Strategic management and organizational dynamics: The challenge of complexity. London, England: FT Prentice-Hall. Triandis, H. (2008). From transactional to transformational leadership: learning to share the vision. Organizational Dynamics 23: 19-31. Werner, J. (2009). TMS Transportation Management Systems & Supply Chain Sustainability.Retrieved from: http: //www.werner.com /assets/ pdf/whitepapers/wp tm s.pdf   Read More