Strategic and Context Evaluation in Sydney, Australia - Boral - Case Study Example

Strаtеgiс and Соntехt Еvаluаtiоn  Student’s Name Subject Professor University/Institution Location Date 1.0 Introduction Boral limited is an internationally recognized company that produces building and construction materials. Its headquarters are in Sydney, Australia. The company mainly deals with cement, plasterboards, bricks, roof tiles and construction materials in Australia, Asia and USA. It therefore plays a vital role in globalization. It is a cyclic company with large production of commodities. As a solution to its challenges Boral has conducted a series of evaluation to assess its performance and production. Its focus is in management of its output, production cost and products price rates. To attain this, it aims at developing and innovating new related and unrelated products in its different sectors of production. The focal point on its performance is to have a sustainable transformation to avoid decline or loss of market segments and at the same time to improve and maintain competitiveness. To attain this management has to be involved in leveraging opportunities and support most important changes. The ever increasing energy, labor costs and materials as well as changing technology are the main threat and challenge to Boral and the management need to constantly review its existing short-term and long-term plans to ensure viable expansion of the company’s and demand for its products. The strategic planning and management is therefore the turning point to transform and improve the company’s performance and production by promoting innovation and creation unique customer value. One area of recommendation is on having a precise organization strategy to get rid of confusion in what strategy. Organizational strategy will mean a designed and developed plan with resources, defined roles and responsibilities, time plans and ways of implementation as well as follow-up and evaluation plans. Eventually, this will promote what ought to be in Boral most immediate areas of action, actions to consider now, soon and later towards attaining a modern enterprise. 2.0 Strategic dilemma 2.1 Products specification Boral’s market offers cover an expansive range of products that further presents dilemma to the industry. The fact that Boral as company supplies numerous goods and services that vary from concrete, bricks, plaster boards , tiles and different types of building materials to different services such as construction, manufacturing, transport and consultation makes it difficult to assess its core competencies in growth. This because the company generally competes in a market place with many different and small firms that specializes in particular products and can easily manage and assess their progress in production and marketing strategies (Charitou, Markides & Strategy 2012). At such point, competition in the market can be considered as very high. Determining whether to maintain, consolidate, and downsize its products is a big challenge for Boral due to the ever changing market and market treads. 2.2 Competition Competition in the industry is continually intensifying as various new firms pave their way into market of which Boral already faces great competition particularly from smaller building products division. The market is attracting due increased mortgages, increases population and demand for houses in different regions in Australia as well as other regions. Consequently, this present a dilemma to Boral on production as it becomes difficult to determine how much growth and production is appropriate in each market. Determining whether this growth should be high, average or low is a great challenge that requires Boral to be more proactive in R&D to overcome the difficult faced in determining the necessary growth due to exiting completion in the market. 2.3 Feasibility and Strategic alliance Strategic alliance refers to an accord between two or more people to follow a set of specified and agreed desirable objectives while still being autonomous in an organizations. This type of cooperation relies on Mergers & Acquisition (M&A) and natural growth. Stakeholders may provide the strategic alliance with resources such as products, manufacturing ability, distribution channels, capital, equipment, knowledge and expertise. The alliance is a collaboration that is meant to reenergize stakeholders as they hope that they benefit in the alliance compared to individual effort. The alliance may involve sharing of technology, expenses and risk (Knoke 2009). Boral faces such dilemma on which firms to merge with and particularly how to cope up with their different strategies and created a workable culture. Forming such an alliance is a challenge for Boral as it seeks for adequate technology, expertise, resources, allowing each stakeholder to gain competitive advantage as well as reduces risk in the company. Unfortunately this might be risky as it may become difficult to coordinate and monitor the alliance and its reputation. Additionally, merger requires large amount of operational costs to ensure essential structural and operational aspects of a company. Also, it may take a lot of time to implement and this becomes risky and increases cost of management. For these reasons, feasibility and Strategic alliance Strategic alliance proves a challenge to Boral Company and its adoption present yet an additional and superior challenge. 2.4 Dynamic Market The ever changing market is a challenge that affects Boral’s activities and growth rate due to too many changes in the consumer market. Boral is thus challenged on where and how to create new opportunities with its products. Most materials are incorporating aspects that reduce environmental threats and there is increased entry of sustainable options in the market pushing competition high within the industry. It is hard for it’s to achieve consolidation of its existing products. That means that Boral has to make a continuous data collection, design products, determine production, be innovative and develop products to make it difficult for new entrants to take its markets. These introduction and adoption may affect Boral capabilities in its operations, marketing and sales strategies. It also threatens the company aim of minimizing production costs so as to meet its goals and objectives. Boral's Strategic dilemma is related to appropriate growth and development intending to increase market of building and construction materials as well as remaining competitive. The question of whether it should remain with its present products in its market is great dilemma for the company. Lack of continuous products development and innovation limit its future potential. This may mean managing and production of a cycle of same products which to a great extinct may create a crisis and reduce competitive advantage. 3.0 Strategy generation Boral cannot become viable without a strategy to downscale its production. Downsizing products in a company is important as it will help the company to increase the quality of production since it can concentrates on a few products. Though on one hand it will creates a challenge as some customers may prefer to buy from companies that have a wide variety of products, Boral will be able to specialize on certain products and ensure continuous development as well as quality and rise to dominance in some products. 3.1 Market growth Developing a strategic growth requires a development plan for Boral Company. Market growth is underpinned by considerations of the external and internal environment in order to establish long term strategic planning (Schoemaker 2012). In order to develop Boral’s strategy in the strategic planning system, there is need to consider the past growth and current opportunities in the market for growth for the company. In turn, it can take a systematized and workable plan. The strategic planning process will play different roles within the organization. The role of the strategy is to establish goals for the company track and complement areas of growth and ensure processes to overcome presents challenge facing the company. It will create capability and ability to realize the goals by undertaking short-run economic activities to ensure predictable business operations that promote competitive advantages. 3.2 Global and Local considerations Boral has a global standing. Its goals to provide construction materials internationally hence requires a specially design to ensure growth. A fact to consider is that the world is dynamic today and different market segments are no longer influenced by larger markets in developed countries (Förster, Liberman & Shapira 2009)). Boral strategy that previously standardized products can fail greatly in its international growth objectives. Eventually, Boral will need to have effective Research and Development (R&D) team to work in multiple market segments. In a world that increasingly demand flexibility, Boral has to ensure that is has a strategy that suits local sensitivity and respond to unique demands. Its strategy must be evolutionally to leverage local markets in the global segments. For instance, there are markets that are increasingly demanding sustainable products while others require normal products and both have to be considered. 3.3 Leveraging different segments Boral has not leveraged great opportunities in due to its strategy that emphasizes on specific market segments. The target market for Boral has been active customers or a demographic group of successful individuals. These groups consumes as per their household incomes which ranges higher compared to other people. Despite the potential to ensure production for highly quality products that mark a certain segment’s preferences, Boral can ensure products that will be demanded by price conscious consumers and at the same time seek value for its products. Eventually, this will lead leveraging segments with many consumers; middle and lower-income earners. Current demand can be expanded and even endear stiff competition by offering alternatives that are cheaper for this consumer segments. 3.4 Technology and Efficiency On the other hand, Boral company desire for growth must be built on new technology and production should reflect modern production systems. In turn, Boral will meet the demands and satisfy customer preferences hence profiting in creation of competitive advantage over other competitors in the same market. With efficient technology, the company can to transform its products growth and development to ensure added quality and value to a customer. Boral has to identify and design products fast and efficient to meet the needs of different customers, come up with pricing strategies to promote profitability. Technology is vital and can lead to adaptation of different and simple strategies that are essential to consider internal and external environment and ensure profitable and constant growth (Erickson, Magee, Roussel & Saad 2012). 3.5 Collaboration and Partnership To be effective in new markets as well as existing markets, Boral require a dynamic team to promote merging and acquisition and effectively promote the company to attain the ability to change the policies, strategies or activities of the according to specific markets. Shareholders need to constantly access up-to-date information from the company on matters involving financial performance and Boral oversees activities as their decisions are vital and their strong interest can be effective in the development plan for the firm. The company’s need to reveal their information to shareholders and investors to encourage them invest their money to the company because that shows a sense of reliability (Mouri, Sarkar & Frye 2012). Meanwhile, the performance in the company generates a great need to promote cohesion among the staffs, executive and shareholders in a company. Consequently, the portfolio management cost of production and operation, implementation and restructuring of the company becomes feasible due to strong interest among stakeholders in the company. 3.6 Customized Products During the next development phase, the company has to introduce new products that mark its core production, marketing and sales strongholds. In turn, it is possible to develop customized products for its long-established customers who require constant renovation like restaurants, accommodation and service industries. Even though products are priced having competition in mind, loyal customers can lead to Boral setting higher prices that signal luxury and prestige for the market segments of like-minded organizations, individuals and institutions that are somehow status oriented and like to be associated with those high-quality products that Boral will produce. These customers are more willing to pay premium prices for specific brand (Pine, Peppers & Rogers 2010). Currently, these customers are found in Boral long-established regions in major cities in Australia and U.S. 3.7 Marketing Strategies Growth is consciously promoted and this takes into account different marketing mix for promoting demand such as promotions, public relations, corporate social responsibility and programs as well as nontraditional marketing (Kotler & Armstrong 2010). Boral need to keep its concepts and promotional activities fresh to ensure variations that attracts customers to its wide-range products lines and ensure effective distribution in different markets. References Charitou, C D, Markides, C C, & Strategy, B M 2012 Responses to disruptive strategic innovation MIT Sloan Management Review, Vol 12, 4. Erickson, T J, Magee, J F, Roussel, P A, & Saad, K N 2012 Managing technology as a business strategy Image. Förster, J, Liberman, N, & Shapira, O 2009 Preparing for novel versus familiar events: shifts in global and local processing Journal of Experimental Psychology: General, 1383, 383. Knoke, D 2009 Playing Well Together Creating Corporate Social Capital in Strategic Alliance Networks American Behavioral Scientist, 5212, 1690-1708. Kotler, P, & Armstrong, G 2010 Principles of marketing Pearson Education. Mouri, N, Sarkar, M B, & Frye, M 2012 Alliance portfolios and shareholder value in post-IPO firms: The moderating roles of portfolio structure and firm-level uncertainty Journal of Business Venturing, 273, 355-371. Pine, B J, Peppers, D, & Rogers, M 2010 Do you want to keep your customers forever? Harvard Business Press. Schoemaker, P J 2012 How to link strategic vision to core capabilities Sloan Management. Read More