Harrison Company - Case Study Example

? Harrison Company Case Rubric Question # 2 – Ethical and Socially Responsible Decisions It is important to highlight that the company faces multiplesocial and ethical issues. The issues are being identified and discussed in the table below: Issue Description about the issue Association in terms of outsourcing with a Honduran company that engages unethical manufacturing practices in its units The issue of unethical manufacturing practices engaged by a Honduran company came into focus when one of the ex employees of the company spread the word in the media that the company share a buyer relationship with the Honduran company that follows slave like working conditions for its employees. The ex employee brought the accusation that Harrison Company engage in buying inexpensive clothing from the Honduran company. Lack of whistle blowing policy It can be assumed that the claim by the ex employee that he was fired because he tried to generate awareness among the top management about the unethical practices of the Honduran company as true. The reason behind considering this incident as a true one is because there is no possible documentation of this incident, which further reveals that the top management did not want to keep a record of this incident and preferred to keep it hidden from the employee view. The lack of a whistle policy within the organization and the option of protecting an employee who engages in whistle blowing activity for the welfare of the organization perceived as a very serious ethical issue. Lack of ability to form a union The company’s focus on restricting the freedom of the employees to form a union has to be considered seriously from the ethical angles. The inability to form a union by the company’s employees will keep themselves vulnerable to the whims and fancies of the top managements. The top management has the ability to make certain changes in regards to pay as well as working conditions which may not be on the employees’ collective favour. The lack of ability to form a union by the employees will lead to the loss of the power of the employees to engage in collective bargaining, which has the potential to develop a sustainable and healthy work environment within the company. Significant amount of donation to the charity It has been identified that the company makes a huge amount of contribution to the favourite charity of the previous president, which is located very close to the company headquarters. Since the company is facing financial difficulties in the current times, the large contributions to the charity become an indirect social issue. The reason this can be a social issue for the company is because the company is focusing on generating profits by relying on part time workers, thereby reducing the chances of full time employment for the potential employees. Significant amount of contribution to the various communities It has also been found that the company makes a considerable amount of contribution to various community specific endeavours. Since the company is facing financial difficulties in the current times, the large contributions to the community endeavours become an indirect social issue. The reason this can be a social issue for the company is because the company is focusing on generating profits by relying on part time workers, thereby reducing the chances of full time employment for the potential employees. Talking in regards to a factor of environmental stability, the issue of unethical slave like manufacturing conditions within the Honduran company needs to be taken into focus. This particular issue has been considered since it has the ability to trigger a threatening situation in terms of political as well as social environment stability in the host country. It needs to be considered that the continued engagement and association of Harrison Company with the Honduran company, which already has developed a notorious reputation for slave type manufacturing conditions, will have a strong negative impact on the company’s image and will thereby impact the company’s marketing environment in a very negative manner. One different ethical dilemma that has been selected from the company’s current range of issues is the factor of significant contributions made to the charity located near the company headquarters. Since the company is facing financial challenges in the current times, the dilemma of ethical nature is to curtail down the financial contributions to the charity made by the company. The main stakeholders for the ethical dilemma are the owners and members of the charity, the benefitting recipients of the various activities of the charity as well as the local population at large. The people who can influence the decision either in favour of the charity or against them are the three directors, who are present in board of directors of the company and hold a majority share of the company. The three possible responses to the ethical dilemma and their possible consequences on the various stakeholders are given below The first response can be to curtail down the large amount of contributions to the charity in a phase by phase manner. This step will impact the capital raising capacity of the owners and members of the charity from the organization and will lead them to look for other major contributors. The second response can be to stop all contributions to the charity completely. This will provide a huge blow to the fund generating capabilities of the charity’s owners and members. The people who are getting benefits from the activities of the charity are also bound to feel the impact since the charity will have increasingly lower amount of funds to manage its charitable activities. The third response can be to continue with the existing amount of contributions to the charity. It needs to be stated that this response will not create any impact on any of the stakeholders of the charity since they will feel no impact at all. As a recommendation, it can be stated that the company can look forward to reducing the amount of contributions to the charity in a phase by phase manner. The action plan will be as follows: Step 1: Reduce the contributions to the charity and get it approved by the board of directors. Step 2: Communicate about the financial difficulty of the company to the charity and state about the company’s plans to reduce financial expenditure. Step 3: Make low amount of contributions to the charity on a quarterly basis. This action plan can be considered an ethical and a socially responsible one, since it has communicated the reasons of curtailing the financial expenses of the company and also tried to minimize the impact on the funding and other activities supported by the charity. It can be expected that the successful implementation of the action plan will help the company to curtail down on the expenses and as a result will help in arresting the decline in revenue for the company. Rubric Question #3: A. Sales Forecast 3 years ago the sales of Harrison Company was $52.10million. 2 years ago the sales of the company was $ 48.99 million. Between the 3rd and the 2nd year the amount of sales dropped by 5.97%. During the last year the company’s sales reached $48.13million. Between the second year and the last year the sales dropped by 1.77%. This indicates improvement, as the company was able to recover the fall in sales in the last year as compared to its fall in the second last year. Fall in sales have also resulted in fall in total revenue earned by the company, and thus the net profit earned by the company has also decreased. But decrease in net profit is lower in the last year as compared to its fall in the second last year. This can be partly because of the improvement in the sales position of the company in the last year as compared to the second last year. As the company has opened 3 more stores, in addition to 80stores, it is expected that the growth rate of the company will rise by 2.5% in the succeeding first year, 4% in the second year, and 5% from the third year onwards. Based on the rise in company’s growth, it is expected that the sales will rise by the same percentage. This rise in sales will not only help the company to improve its condition, but will also generate increased revenue which will increase earnings and will help the company to overcome the losses faced in the previous years. Harrison Company   Amount in $ million   3 years ago 2 years ago Last year Five Years Forecasted Sales Sales 52.10 48.99 48.13 49.33 51.30 53.87 56.56 59.39 Growth Rate(%)       2.5 4 5 5 5 B. Finance The financial statement of a company aims to provide information about the enterprise’s financial position on a given date. Such information helps the decision makers to strategize correct course of action. The decision makers may be internal (management, shareholders, employees, etc.) or external (creditors, investors, government, competitors, etc.) to business enterprise. The financial statements in isolation are not enough to give meaningful information unless it is compared with other financial statements. There are various techniques available for the analysis of financial statements like trend analysis, ratio analysis, common size statements, comparative statements, and cash flow analysis. These techniques help to compare a company’s performance with its chief competitors in same industry as well as monitor the company’s progress over time. Ratio Analysis Ratios can be broadly classified into income statement ratios (derived from income statement), balance sheet ratios (derived from balance sheet) and composite ratios (one item from balance sheet and another from income statement). Accounting ratios have immense application in interpretation of financial statements by helping perform both intra-firm and inter-firm comparison. Intra-firm comparison helps to measure the performance of the company on yearly basis while inter-firm comparison helps to evaluate Company’s performance with its competitors. Liquidity Ratios The liquidity ratios help to evaluate the firm’s ability to honour its short term or current obligations. It is an indicator for the measure of working capital management. The firms’ short term obligations include carrying out day to day operations, payments to creditors for purchase of raw materials, payment of daily wages of labourers, outstanding expenses and bills payables, etc. These current liabilities are financed by current assets. Examples of liquidity ratios are current ratio and quick ratio. The ratio of current asset to current liabilities is defined as current ratio. The components of current assets are bank or cash balance, accounts receivables, debtors, accrued income, prepaid expenses, and short term investments. The components of current liabilities are accounts payable, creditors, provisions and advances, short term loans, overdrafts, and advance receipts. The quick ratio is also known as liquid ratio and is defined as the ratio of quick assets to current liabilities. The quick asset is referred to all current assets except the inventories. Hence, the current assets less inventories give the mathematical value of quick assets. According to the data provided in the case study of Harrison Company, the Liquidity Ratios can be calculated as follows: RATIO ANALYSIS Harrison Harrison Harrison Harrison Harrison Harrison Last Year Percent of Sales 2 Years Ago Percent of Sales 3 years Percent of Sales         Ago   A. Liquidity Ratios             Quick ratio= Current assets - Inventory/ Current Liabilities-Bank overdraft 0.07 6.71% 0.06 6.03% 0.29 28.97% Current Ratio= Current Assets/Current Liabilities 0.69 68.52% 0.60 60.12% 1.16 116.20% From the above Liquidity ratio analysis it is apparent that Harrison Company’s liquidity on an average has experienced a declining trend during the previous three years. Three years ago the company’s current ratio as percentage of total sales was 116.20% compared to 68.52% in the previous year. Since higher values indicates larger margin of safety in covering short term obligations, this means that the company has been investing some part of fund in the recent years to increase profit ability. RATIO ANALYSIS Global Market Leader Global Industry Market Average Leader   A. Liquidity Ratios       Quick ratio= Current assets - Inventory/ Current Liabilities-Bank overdraft 0.24 23.39% 17.57% Current Ratio= Current Assets/Current Liabilities 0.90 90.06% 128.38% When Harrison Company’s Liquidity ratios were compared to global market leaders it was found that quick ratio of global ratio was almost three times and current ratio was almost 1.28 times more than Harrison Company. This implies that global market leaders prefer safety compared to short term investment. Leverage Ratios These types of ratios are often considered as safety ratios since highly leveraged balance sheets (as a consequence of including higher debt capital) increase the financial risk of the company substantially. Alternatively it can be said that leverage only exists when the company’s capital structure includes debt capital. The most popularly used leverage ratios in the industry is debt-equity ratio. The leverage ratios of Harrison Company can be calculated as follows: RATIO ANALYSIS Harrison Harrison Harrison Harrison Harrison Harrison Last Year Percent of Sales 2 Years Ago Percent of Sales 3 years Percent of Sales         Ago   B. Leverage Ratios             Total Debt to Assets Ratio= Total Debt/ Total Assets 0.60 59.90% 0.60 59.60% 0.45 44.80% Debt-Equity ratio= Total Debt/ Total Shareholder's equity 0.42 41.65% 0.20 20.30% 0.23 23.01% From the above Leverage ratio analysis it can be said that the company has decided to include more debt in its capital structure in the recent years compared to previous years which has significantly increased its financial risk compared to previous years and this is as per industrial standards and similar trends have also been found in capital structure of global leader’s financial statements. Profitability Ratios The profitability of a company can be measured in terms of gross turnover or sales or the capital employed, or total assets. It is a key indicator of the company’s performance in its industry of operation. It helps to measure the company’s position. The profitability of Harrison may be measured using the following ratios: RATIO ANALYSIS Harrison Harrison Harrison Harrison Harrison Harrison Last Year  Percent of Sales  2 Years Ago  Percent of Sales  3 years Ago Percent of Sales  C. Profitability Ratios           Gross Profit Margin= Gross Income/Sales 0.20 20.10% 0.20 19.80% 0.20 19.80% ROA= Net Income/Total Assets 0.003 0.20% 0.01 0.60% 0.03 1.80% Operating Profit Margin= Operating Income/Sales             Net Profit Margin= Net Income/Sales 0.002 0.20% 0.01 0.60% 0.02 1.80% Theoretically, liquidity ratios and profitability ratios are inversely related which means that if liquidity increases then profitability will decrease and vice-versa. As discussed earlier, since liquidity of the company decreased marginally in the three years it is expected that company’s profits would increase and this is evident from the above profitability ratio analysis which shows marginal increase in company’s profit in the last three years. RATIO ANALYSIS Global Market Leader Global Industry Market Average Leader   C. Profitability Ratios       Gross Profit Margin= Gross Income/Sales 0.24 23.90% 0.80% ROA= Net Income/Total Assets 0.07 3.30% 0.19% Operating Profit Margin= Operating Income/Sales       Net Profit Margin= Net Income/Sales 0.03 3.30% 0.10% When the profitability of Harrison was compared to global market leader it was found that it significantly lagged behind but when compared to Industry Average, the profitability of Harrison was satisfactory. Efficiency Ratios These ratios typically help to analyze how fairly a company utilizes its internal assets and liabilities. These ratios help to judge a company’s efficiency in terms of repayment of liabilities, turnover of receivables, usage of equity, machinery, inventories and so on. The efficiency ratios of Harrisons can be calculated from the given data as follows, RATIO ANALYSIS Harrison Harrison Harrison Harrison Harrison Harrison Last Year Percent of Sales 2 Years Ago Percent of Sales 3 years Percent of Sales         Ago   D. Efficiency Ratios             Return on capital employed= Net Income/ Capital Employed, where, Capital Employed=Debt Liabilities + Shareholder's Equity 0.01 0.35% 0.02 1.23% 0.04 2.65% Return on Equity= Net Profit (after interest and tax)/ Shareholders fund 0.01 0.50% 0.03 1.49% 0.06 3.26% During the previous three years, the efficiency of Harrison Company has been found to decline implying that the company has not been using its assets efficiently. RATIO ANALYSIS Global Market Leader Global Industry Market Average Leader   D. Efficiency Ratios       Return on capital employed 0.11 5.02% 3.21% Return on Equity 0.18 8.11% 6.49% When Harrison Company’s efficiency is compared to global market leader and overall Industry average it was also found that the company significantly lacks behind the industry. The company should focus on increasing its efficiency by utilizing its assets in a more productive way. If the company does not operate efficiently, it will not be able remain competitive in the market. Evaluation of Financial Position The financial statement analysis conducted earlier will help to evaluate the overall financial position of Harrison Company. From the financial statements of the company it can be said that the total equity of the shareholders has declined marginally and the total assets of the company has also decreased marginally implying that the company is facing competition from the global market leader and is thus investing its assets to increase market share. The company’s efficiency ratio has also experienced declining trend implying it is not able to utilize its assets in the most efficient manner probably due to increased competition. The overall position of the company appears stable due to stable cash inflows from sales. The company’s profitability is expected to increase in future in line with expected increase in market share. Financing Strategy The balance sheet of the company was analyzed during the previous three years and it was found that there was significant increase of debt capital in its capital structure. This phenomenon is expected to enforce debt capital funding constraints on the company’s financial strategies since its balance sheet is already leveraged and further inclusion of debt capital would increase financial risk of the firm. If the company plans to raise capital in future for various reasons including strategies to capture market by launching new product in the market, diversifying geographically, introducing new brands, and so on, then it has the option of diluting the stake of its shareholders and raise funds by equity capital. This will reduce company’s financial risk and at the same time it will provide necessary funds. C. Logistics and Operations For the purpose of identifying the issues of supply chain and the related areas for improvement, the focus needs to be given on the multiple factors of logistics. While studying the position of the company’s stores as well as the distribution centres from the map, it was found that a number of stores of the company were located in the regions where there has been a decline in population. To tackle this particular factor, the company will focus on opening 3 new stores in the region of West Virginia I. The first factor that needs to be addressed is the supplier transportation to the distribution centres. With the opening of the new stores as well as the planned change in the inventory management process, the frequency of delivery from the suppliers needs to increase. The suppliers need to make the delivery of shipments once a week. II. The second factor that needs to be addressed is the method of inventory management at the distribution centres. Since there will be a change in the process of order procurement from the stores, the new kind of arrangement will help in better demand forecasting for every store. The new arrangement will require weekly shipments from the suppliers and as a result will lead to a need of better inventory management in the distribution centres. It can be assumed that the better demand forecasting and more frequent shipments from the suppliers as per the store demand will help in the process of increasing the efficiency in the inventory management for the distribution centres. III. The third and the most important factor is the issue of transportation from the distribution centres to the stores. It has to be considered that the factor of transportation has a direct involvement in the financial expenses of the company. Efficiency in the transportation process will help in the reduction of financial expenses for the company. For increasing the efficiency of fuel, the price of which is supposed to rise in the upcoming days, proper route plan for the company’s trucks needs to be planned. 6 trucks will be used to transport the merchandise orders from the Massachusetts distribution centre to the stores present in Massachusetts, Connecticut, Maine, New Hampshire, and New York. The remaining stores will be supplied with the merchandise by 3 trucks from the distribution centre present in Pennsylvania. IV. In discussing about the inventory management for the stores, it can be stated that the new inventory management system that will be applied in the stores will help in the better demand forecasting for the individual stores. The better demand forecasting will help in the reduction of the storage space for the stores from the current 20 square feet to 10 square feet. This will provide the scope for increasing the entire store area for displaying merchandise. It can be expected that the change in the store layout and the increase in display area will play a positive role in boosting the sales of the store merchandise. V. The process of information gathering in regards to the merchandise needs to be completely overhauled by implementing a new edge retail inventory management system. The new system will be installed in every store of the company that are present in various geographical locations. The new systems will have the ability to track the merchandise movement in the various junctions of the logistic movement. Also, it should have the ability to provide real time information about the amount of sales happening in each store to the company headquarters. By analyzing the demand from the various stores, the company headquarters should focus on generating a specific inventory threshold for every store. A fall in the inventory level below the store specific threshold will automatically trigger an alert for fresh delivery of merchandise. The operating analysis table given below highlights the factors of number of employees, total working hours per year, work load per employee as well as financial aspects per individual of the store on annual basis. For every store, the number of temporary employees is estimated at 4 while the number of store manager is estimated at 1. The total working hours for a store is 6500 hours and the stores remain open for 6 days a week for a period of around 10 hours. It has been assumed that the store manager is present all the time in a store. Assuming that there is 52 weeks in a year, it has been estimated that the store manager works for around (6*10) * 52 or 3120 hours per year. Thus the total working hours for the temporary employees is estimated at around (6500 - 3120) or 3380 hours per year. Since there are 4 temporary employees, it can be stated that the total working hours per year for a single employee stands at around 845 hours. On a weekly basis, it comes to around 845 / 52 or 16.25 hours. Hence, roughly the work load per employee stands at around 2.5 hours on a daily basis. Since the store manager earns $35,000 on an annual basis, so naturally his earnings per month come to around $35,000/12 or $2916.66. This again comes to around $2916.66 /4 or $730 (approx) on a weekly basis. Now estimating that the temporary employee earns around $350 on a weekly basis, the financial expenses for a temporary employee on an annual basis comes to around $350 *52 or $18,200.   Temporary Employee Store Manager No. of employee 4 1 Total Working Hours/ Yr 3380 3120 Work Load/ Employee 2.5 hrs 10hrs Financial Expenses/ Individual/ Yr $18,200 $35,000 It is important to highlight that during the process of the calculations, it has been considered that all the four part time employees including the store manager will be present in the stores for 6 days a week. In discussing the importance of an effective sales forecast in connection to the logistics and operations for the company, it can be said that the proper sales forecast helps in understanding the amount of merchandise required for every store. It also help in understanding the urgency of the merchandise requirements and as a result will lead to the process of better route planning of the company trucks. The better route planning of the company trucks automatically increases the efficiency in fuel consumption and thereby helps in reducing the operating expenses for the company. Also, the process of staffing the stores through four temporary employees also helps in greatly reducing the store operating costs for the company. Rubric Question # 4 – Identifying industry and global trends While trying to identify the industry and the global trends that might impact the Harrison Company, the focus needs to be given on the micro and macro factors present in the current environment and have the ability to impact the strategic moves of the company. Talking in regards to the industry trend, the factor of increase in competition in the market has to be considered. Talking in a more specific manner, the fact that there is a Wal- Mart store within 10 miles of each of the company’s store has significantly beefed up the level of competition in the market. The increase in competition from Wal-Mart which is a strong competitor for the company presents a significant threat to the company’s sales prospects. Another industry trends that needs to be considered is the impact of recession on the entire industry. The impact of the recession in this particular sector is creating pressures on finances of all the players. Because of the industry wide financial pressures, the possibility of attending growth in the revenue will be greatly impacted. Now discussing about the global trends, the factor of the rise of diesel fuel needs to be considered. It needs to be highlighted that the increase in the costs of the diesel fuel will significantly trigger the cost of trucking operations of the company. This will raise the cost of transportation of merchandise to the stores. Another global trend that needs to be considered very seriously is the rise of inflation which pegged to jump at around 15% on a yearly basis. The increase of inflation on an annual basis will significantly raise the cost of production of merchandise for the 20% suppliers of the company present in the United States. This will increase the cost of merchandise acquisition from the US based suppliers to a certain extent. Also, the possibility of a low Fed fund support will impact the exchange rates of the business. This will greatly impact the business prospects of the company in a great way since the company sources a considerable amount of its merchandise from the suppliers present in the markets of developing countries as well as eastern Canada. Another global trend that needs to be carefully monitored is the macro and micro level economic movements in the developing markets. The reason this particular trend has to be monitored is because the company has around 40% of the suppliers in the developing markets. The positive or negative movements of the economy in the developing markets will have impacts on its currency and will thereby impact the cost of outsourced manufacturing for the company. Rubric Question #5 – Leadership and Group Dynamics: A. While discussing about the successful turnaround of the company, it is important to consider that a number of strategies has been designed and needs to be implemented throughout the company. In this particular case, for achieving a proper turnaround of the company, a transformational kind of a leadership needs to be followed. A transformational kind of a leadership is portrayed by a leader who has the ability to engage his employees and subordinates while boosting the level of motivation and morale. It is important to highlight that in case of a transformational leadership, the main objective is to enhance the performance of the followers while developing a maximum amount of potential within them (Gilbert, 89). While implementing a transformational kind of a leadership within the organization, a diverse approach needs to be followed for handling the employees of the organization as well as the board of directors. For smooth implementation of the strategies, both the full time and the part time employees who are working in the stores as well as the part time setups will be summoned to a meeting, which will be help in the company’s headquarters. To ensure attendance of the employees for the meeting, the employees will be provided motivation by communicating them about the arrangements of free food and drinks. In the meeting at the headquarters, the employees will be briefed about the company’s new strategies. The meeting will also focus on addressing any issues raised by the employees in connection to the new strategies of the company. Apart from communicating the new strategies of the company, the meeting will be used as a platform for boosting up the morale and motivation of the employees of both temporary as well as permanent category. In demonstrating the leadership skills as a transformational leader to the board of directors, the focus will be on the process of effectively communicating the newly designed strategies and simultaneously getting them approved. While doing so, the focus will be on the process of demonstrating long term vision for the company along with analytical and decision making moves of the company (Evans, 61). B. It is important to consider that the team morale is largely dependent on a wide range of factors comprising of motivation, compensation, work load as well as the mutual understanding and nature of communication within the team. In this case, the report provided by the outside consultant reveals that the home office employees are suffering a low morale because of the factors of significant infighting among the team members, lack of clarity and accountability in the decision making process, incidents related to passive aggressive behaviour as well as the issues of insecurity because of the perception of possible financial difficulty faced by the company. It is important to highlight that the low team morale of the employees is leading to the creation of conflict kind of a scenarios. In explaining conflict from the perspective of organizational behaviour, it can be stated that conflict is a state of mental disagreement where the values and needs of a person are in collision with the other. Conflict can be of various forms and intensity. It can range from interpersonal conflict, intergroup conflict as well as inter-organizational or industrial conflict. In this case, since all the eight employees work from their own home office setups, hence, it is pretty evident that the conflicts are of interpersonal nature. In defining interpersonal conflicts, it can be highlighted that it is a state where the concerns or focus of two or more individuals appear to be incompatible in nature. The outcome of an interpersonal conflict is that it leads to the process of generation of frustration as well as intolerance among each other. It is important to state that generally the interpersonal conflicts within an organization are resolved through the process of addressing in the form of collaborating, compromising, grievance redressal or making accommodating arrangements. In this case, the conflict issues of the home office employees are diverse in nature. For the purpose of resolving the issue related to infighting and quiet resistance, the entire group of home office employees needs to be summoned to a meeting at the company headquarters. All the eight employees will be communicated in advance that the agenda of the meeting is to discuss and resolve the various issues faced by them in handling their specific job roles. The employees will be encouraged to discuss and resolve the various difficulties faced by each one of them in a collective and group based manner. Finally, the employees will be briefed about the multiple benefits associated in working in a collaborative group based manner. To tackle the issue related to unnecessary arguments among the team members, it can be highlighted that the company needs to brief the home office employees in regards to the specific requirements of their individual job roles. Apart from that, the home office employees needs to be motivated to communicate among each other so that the productivity of the entire group increase and contributes to the greater good for the organization. It can be expected that to develop a positive outcome in connection to the resolution of the interpersonal issues, a minimum time period of around 1 month will be needed. In a scenario, where few employees of the home office setup are resistive about adopting the methods which were developed as a process of resolution of the interpersonal conflicts, individual counselling will be provided to the employees. The individual counselling will help the employees to understand the benefits of a collaborative and highly interactive team and will help them in the successful transition into a new group based working style. Rubric Question #1 – Implications of Integrated Business Processes Since the competition on the company’s stores has increased because of the penetration of Wal-Mart within a 10 mile radius, hence it is very important to engage in an offensive strategy. While engaging in an offensive strategy, it is important to consider that the stores merchandise should be of good quality and should be able to provide value to the consumers. Since the competitor Wal – Mart is a leader in the low cost strategy and has a high amount of financial power to support its business strategy; it is recommended for the company to opt for a differentiation strategy. While discussing in an elaborate manner about the process of differentiation of its retail products, the company can focus on building a season specific theme as well as the latest fashion trends that are emerging in the US market. A season specific theme as well as fashion specific clothing trends will automatically help in the process of creating awareness about the product specific differentiation of the company among the consumers. Now discussing about the store strategy, it can be recommended that the focus will be on the mode of limited expansion. It can be said that the Harrison Company will focus on opening three new stores in West Virginia. The new stores will be opened in the region where the population is high. Talking in regards to the long term, it can be said that with regards to the opening of the new stores of the company, the company’s rate of growth will increase by around 2.5 % in the first, 4 % in the second year and around 5% from third year onwards. Also, the strategic change implemented in the route plan of the trucks owned by the company will help in a great way in the process of providing smooth delivery of the merchandise to the various stores of the company while reducing the fuel related expense of the company. Also for reducing the financial expenses, the Harrison Company will be focusing on the process of scaling down the contributions to the charity in a phase by phase manner Works Cited Gilbert, Kwame. Transformational Leadership. USA: Xulon Press. 2012. Print. Evans, Jeff. Inspirational Presence: The Art of Transformational Leadership. USA: Morgan James. 2009. Print. Read More