Probable issues when doing business in Sri Lanka - Essay Example

Probable issues when doing business in Sri Lanka Introduction In response to your current request for a current strategic plan regarding the business environments in Sri Lanka that ISSAC Corporation can expect to encounter, it has been established that Sri Lanka’s business environment favours infrastructure development, health services, and tourism as sectors with the most potential for international investors. The main method of recruiting the workforce in Sri Lanka is through the newspapers. Many business consultancies advocate for the use of a specialist recruitment firm to vet applications, since they are likely to be massive in number. However, some highly technical posts may prove a big challenge to fill, particularly in new training opportunities. In addition to this, Sri Lanka’s tax rates are extremely higher when compared to the neighbouring countries. For instance, its tax rate ia at 105.5%, compared to an average of 44.5% of South Asia. Government bureaucracy and inefficiencies, corruption, and policy instability are often noted while doing business here. Inflation is very high as well, considering that the nation’s inflation rate was averaged at more than 10% yearly between 2004 and 2012. Further, even though the country claims to access electricity 24/7, it is noted that blackouts are more frequent as a result of a growing demand for power, faulty power plants, and grid inefficiencies. Due to these issues, I would include strategic objectives, tactical implementation steps, and a timeline of between January 1, 2014 through December 31, 2014, with assigned functional responsibilities to enable the business fit properly in the environment. Strategic goals Financial efficiency To lower expenses by at least 10% By aligning monetary performance with the firm’s strategies To boost net profit by approximately 20% annually It is recommended that the company optimize its working capital To enhance general efficiency as weighed by throughput. ISSAC will have to manage enterprise compliance and risk To enhance general productivity (Bourgeois 550). We recommend that ISSAC carry out its operations much more with what the company already has To increase revenue with by a bigger percentage than last year Through driving growth and strategy Client/constituent Increase customer retention We recommend that ISSAC retain its former clients through maintaining constant communication and extensive services Introduce existing products and services into Sri Lanka’s new market This will be done through promotions and advertisement through Sri Lanka’s media Achieve and adhere to an exclusive customer service It is recommended that ISSAC develop and make good use of a customer database. To expect future client needs Done through client feedback To extend sales and other services to the global marketplace We recommend that ISSAC establish new branches in the neighbouring countries using the same brand name Having a stable workforce To recruit, hire, and maintain the right staff, in the right departments in the new country We recommend that the firm use a specialist recruitment firm in Sri Lanka to vet the newspaper applications made Employ professionals who are more likely to bring success to the company Each recruited employee will be allocated a post as per his or her professionalism and competence in a given field or department To train employees on internal matters of the company Through developing a wide range of skills essential for customer support Through aligning employee performance with rewards and incentives To continuously learn and take up up-to-date best practices We recommend that the company organize for awareness rallies that inform employees on the best practices desired by the surrounding community (Kaplan & Norton 80). Internal efficiency and success in business operations To have all the product and services meet the excellence standard guidelines of the company with connection to Sri Lanka’s culture It is recommended that the company adjust their services to fit the needs of the new customers To take advantage of physical facilities such as capacity and location Through using Sri Lanka’s exports such as rubber and tobacco to get revenue and increase investments To increase technology management efficiency We recommend the use of virtual or wireless technology throughout the business operations (Watson 34). To successfully implement and recognize gains from the firm’s computer and software systems First, it is recommended that the company get a sophisticated and alternative way of a stable electricity supply system, and employ a qualified IT staff to ensure efficient computer maintenance To minimize the rate of expenses incurred by the company Due to the high tax rates experienced in Sri Lanka, it is recommended that ISSAC be on the forefront to use its agencies to ask for some “tax holidays” to be implemented by the government to reduce tax and allow investment. Appraisal The purpose of this memo was is to inform the ISSAC CEO and the executive management of the potential business environmental issues that the company could face when starting-up business operations in Sri Lanka. Some of the issues noted in the presentation include high tax rates, high inflation rates, poor government policies, bureaucracy and inefficiencies, corruption, insufficient electricity supply, and challenges in recruiting technical staff. Included in the memo are the strategic goals on which to focus on during the operations in the new country. The strategic goals are however not the overall corporate goals of the company but those formulated to enable it deal with the environmental issues and to achieve success in a new marketplace. In correspondence, the objectives named above have the to be met by the company through the tactics mentioned below each one of them. If the recommendations given are applied strictly, the company will efficiently deal with the underlying environmental issues and carry on the daily business operations efficiently and in good time. This will also help ISSAC to better determine the depth and extend of each issue or objective proposed. Work Cited Bourgeois, L. Jay. "Strategic goals, perceived uncertainty, and economic performance in volatile environments." Academy of Management Journal 28.3 (1985): 548-573. Kaplan, Robert S., and David P. Norton. "Using the balanced scorecard as a strategic management system." Harvard business review 74.1 (1996): 75-85. Watson, Gregory H., and Watson. Strategic benchmarking. NY: John Wiley & Sons, 1993. Timeline Strategic gaol time Person responsible Financial efficiency January-march 2014 Financial manager Client/constituent efficiency March-June 2014 Corporate responsibility manager Having a stable workforce June-September 2014 Human resource manager Internal efficiency and success in business operations September to December2014 The overall management board Read More