SEMCO Company Strategy - Essay Example

SEMCO Company Strategy Different companies use different strategies to record their preferred results. In many instances, companies have to change their strategies to develop. This is due to the ever evolving market. As such, the market needs to be encountered with different strategies. For instance, with the improvement in technology, many companies have to improve. This is by using technological advancement in their service provision. In recent times, many companies have been noted to invest heavily in acquisition of new machinery and equipment (Furrer, 2010:34). This is not a point to brag, but it is an advancement to make service provision even better. For instance, purchase of new technology ensures a company’s production is improved in quality and quantity. Similarly, the goods that are produced will be of increased value (Semler, 2000:54). This will prompt customers and clients to use more of the goods. With such a drill, a company is most likely to record positive results, which increases its financial muscle. Companies not only use technology as an improvement, but also indulge other manoeuvres that could make their performance better. For instance, some companies use branding as an appropriate method of sticking to their customers. When companies introduce brands in the market, the market gets connected to such (Kazmi, 2008:56). This ensures that they have a strong market niche for the products. In such a position, a company is guaranteed to make basic sales even during low seasons. Similarly, some companies in the market use marketing techniques that are deemed to improve the market perception of their goods. When the market is attracted to their goods, it is possible that they will rely on the product for the entire time. In such a drill, the market will not look for substitutes of the good, but will have loyalty in consumption. This helps a lot in ensuring a company is growing in terms of customer demand. In addition to this, some companies decide to deal in a large variety of products and services in the market (Jansson, 2008:23). This is a way of spreading risks as one part of the company may not sell any product, while the other parts have lucrative sales. For instance, a company that deals with service provision can also indulge in other products that are connected to the market. For instance, a company that sells computers and other accessories can decide to start operating internet services. Since customers could have enough computers, they will still need internet connections at all times (D'Angelo, 2009:52). In such a situation, computer sales could stall since customers may not demand the computers. However, the company will still make sales as people will still demand internet connections at all times. SEMCO Company has been recording successful results in the market, yet it does not have a written strategy or plan. It is in the market and making a positive accrual due to its activities that are concentrated on the customer market. With such a drill, the company is on the verge of making lucrative profits that are not linked to any strategy that is in writing or planned (Suneja, 2002:13). SEMCO Company decided that its businesses should be increasing in each financial year. However, it did not strategise on its expansion rate to a particular point. In such a drill, it ensured that transformation would continue in every year (Semler, 2000:55). For instance, over the last ten years, the company tripled its employee base. Many companies have a phobia of increasing the number of employees. This is done to ensure that they control their expenditure in salaries and wages (Lymbersky, 2008:12). As a conservative business strategy, many companies feel that employing more personnel in the same setup will increase their costs and this would reduce their profits at the end of a trading year (Mazzucato, 2002:34). However, this was a strategy that helped SEMCO to improve to greater heights of quadrupling their profits. When there is an increase in the number of employees, it is obvious that the cost for labour will increase. However, SEMCO did not reflect on the negative side of having an increase in the cost of labor. SEMCO reflected on the side of better services and products that are supplied to the customers. In essence, the company noticed that their products needed a greater increase in their value (Bruce and Langdon, 2000:55). This led to production of high quality goods that would be appreciated in the market. With such a manoeuvre, most of the market was dominated by the products that are produced by SEMCO. With an increase in the number of employees, a company is defined to have more manpower and labour. In such a position, a company may decide to concentrate in various production models. According to the schools of strategy by Mintzberg, when a company has maximum labour, it is in a position of investing in a wide variety of services. This includes investing on other services that it has not been producing. SEMCO decided to strategise on this point by increasing its output. Since it had enough labour, it only had to increase its resources and start other services in the market (Kourdi, 2009:32). For instance, it only used to produce hardware and equipments to the market. However, it developed more services that would be offered in the market. This not only impressed the market, but created a demand for their products and services. Transforming a business may sound a difficult task for a business person, but this was not the case in SEMCO. SEMCO decided to transform its business to greater avenues in supplying other services apart from the basic services that were in the business. In this manoeuvre, the company decided to embark on complimentary services (Porter, 1996:4). These are services that are requested alongside the goods that are sold by the business. For instance, when a customer purchases a pump, a company may decide to fix the pump and provide other fixing materials. In such a strategy, the company will have fully serviced the customer’s needs at a convenient stage. The customer will have full services from a sole service provider, which saves time and energy. Therefore, many customers were served at a single encounter with the business and could have all their needs sorted (Michael, 2002:22). This made a positive record in the market as most of the people began requesting for the services of the company. As a matter of fact, the business grew due to its prevalence in the market. The business had created a large employee base that would conveniently serve the existing and growing market. In a business, change is inevitable. In making change in the company, SEMCO decided to bring a team of managers that would direct the change in the business. These are effectively trained people that scout for ideas used by a company to make change in its business. Though these managers may be expensive, they are worthwhile assets for a business. In this scenario, SEMCO did not mind the extra expenses that would occur when they employed the army of managers (Semler, 2000:57). In such a case, the management knew that the rates of return would be higher than the expenses. When the managers were incepted into the organisation, they generated creative ways of ensuring the business was sprouting. Managers never stop crafting their ideas and changing for the betterment of an organisation. In SEMCO, this idea was practical and influential. In its business, SEMCO did not stop at a point when their business was making lucrative profits. However, they had an idea of making an even longer stretch in profit levels. For instance, when they moved from product provision and invested in service provision, their sales stretched higher. However, they did not rely on their ostensible product provision, and extended their concentration to service provision. This was a bold step that would not be an attempt of weak business managers. As a matter of fact, in the last financial year, the company recorded a 75% growth of its business in service provision. This means that only 25% of its businesses were directed to product provision. This was a transformation as it showed a greater change when the company invested in another range of services (Pettigrew, Whittington and Thomas, 2001:31). Had it stuck to the same product provision, it is definite that the sales would have drastically reduced. To make the point worse, the business would be making losses if it had concentrated on selling products other than relying on provision of services. Therefore, it is a prudent idea to continue changing and transforming business ideas and making them practical in businesses. In SEMCO, a business idea was not neglected. This was a practical example of an opportunistic business that banks on opportunities to make a business greater. For instance, the company used to produce cooling towers, but customers kept complaining about the high maintenance of the towers. This complaint from customers was received with seriousness in the company. To make a positive opportunity out of the customers’ situation, the company decided to offer cooling tower maintenance services. In this situation, it is evident that the customers developed a problem that was solved with an opportunity of developing another business and line of services (Hax, 2009:12). In making it a success, the workers gave it the best shot and the business proved to be successful. Though these were extra services, customers requested the business to start maintaining their air compressors. Though this business was out of the line of businesses that SEMCO does, they decided to embark on this one. It proved to be a positive experience as the proceeds were positive. In reflection to the above scenario, it is evident that SEMCO crafts its success from transformational business involvement. Its ideas are creating and are implemented with every step. This is an ideal business that has been growing from scratch and has invested in other businesses that were not in their line of service provision. To make the situation simpler, SEMCO is a business that takes risks in every idea that is developed. The risk of getting involved in other businesses is high, and so are the businesses. In their business maneuvers, the company decided that dealing in production alone would not guarantee better performance. However, investing in other risky fields would be appropriate. In their investments, the company collected information from the customers in the field. These customers expressed their need for certain services that were lacking (Mazzucato, 2002:43). Since they had the resources to invest in such businesses, it was a great idea in making such a step. This shows the difference between businesses that are destined to perform and other businesses that stick to their line of service provision (Ghemawat, 2009:56). When a business does not take risks, it is obvious that they will stick to their line of production. Therefore, a business that does not have any risks makes fewer profits. According to schools of strategy by Mintzberg, a business that has many risks is proved to be lucrative. As such, a business that will make many risks that are daring will be better positioned to make better profits. SEMCO was particularly, driven to perform what customers wanted (Moseley, 2009:45). As such, the firm noted that a customer was a core element in transaction. To make this a positive accrual, they decided to treat a customer according to their needs. In many instances, the customers approached the firm for services, and the company would take the initiative of supplying the services promptly (Bradley, 2005:46). According to schools of strategy by Mintzberg, a business should “think out of the box” to make a positive accrual in service provision (Paul, 2008:23). However, in this scenario, it is evident that SEMCO insinuated that the box never existed and did open thinking. For instance, a client had more than 126 contractors with different services and products to provide. However, the client approached SEMCO, and the firm took an initiative of replacing all the 126 contractors. This was a hard task, but it was a business that would be worthwhile. In this evolving world, people are using the internet for virtually all their businesses. Therefore, using the internet is a worldwide activity that even involves under age people. Therefore, it is a business that has a large number of people who need the services. Since the service providers are not equal to the people in need of the services, it is a probable investment (Whittington, 2001:34). To make it an easier investment, SEMCO merged with a company that closely deals with the internet venture. Within a short time, SEMCO had established a market in the service line. This helped increase the number of people that would request for the services of the company, which increased its output. In conclusion, the SEMCO management operates on a system that is not controlled by a managing force. However, the management is open to negotiations and accepts any viable new idea. This has made it an opportunity to invest in other fields which are not restricted by the management. In many businesses, the management controls all ventures and may not invest in some of the ventures that are brought forward. Apparently, the SEMCO management treats the customer as a core subject in the business. The values of the business are not considered when a customer is a priority. In such a situation, the customers are served according to their needs. Lastly, the SEMCO was positioned to make decisions quickly and openly. This saved time used in initiating businesses and service provision. References Bradley F. (2005) International Marketing Strategy, New York, Financial Times Prent.Int. Bradley F. (2005) International Marketing Strategy, New York, Financial Times Prent.Int Bruce,A. & Langdon K. (2000) Strategic Thinking, London, Dorling Kindersley D'Angelo, J.M. 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