Strategy Formulation and Recommendations Name Course Date Institution Strategy Formulation and Recommendations Part 1 Fosters Group has an aim of expanding its market share since it already bears significant recognition in Australia. It however, it faces stiff competition from Coopers Brewery and Lion Nathan. To achieve this, boosting the market share is the way forward. It also faces a challenge on the consumer consumption of low-strength beer over the past six years.
For a strategy to be supportable, it requires to be implanted in the company’s capabilities and resources. As the external environment of the company gradually changes, so must its long-term strategy base upon capabilities and internal resources. Organizational capabilities refer to the enterprise ability to manage, organize, undertake or coordinate sets of activities. Organizational activities are based on assets in a joint effort to enable activities in a trade process to be accomplished. Assets would refer to resource endowments that are accumulated over time and could be deployed to obtain competitive advantage in the market. Assets are separate from capabilities as they are not processes or activity chains. Capabilities are a firm’s capacity to deploy assets, normally in combination, using organizational procedures to attain a desired end. Core competencies are what a firm does predominantly well with regard to competitors (Chowdary, 2008).
In this dimension, competencies are drawn according to two major distinctions. One distinction is competency held at corporate, group or individual level. The next is competency at functional, strategic and operational significance. Individual competencies comprise of the capability of individuals to act and see their role in satisfying customer expectations and customer satisfaction. Individuals should direct their own effort and time to the organizational advantage and carry out tasks efficiently. Group competencies are in formal and informal alliances of individuals assembled together to accomplish set goals.
Corporate competencies are maintained in the direction set for the company, management of knowledge acquisition, running of portfolio activities and full exploitation of resources. Strategic competencies relate to senior management’s capacity to recognize and interpret the environmental inclination and industry events influencing the organization. Logistics management, technological tools, cost controlling skills, financial management, human resource management and manufacturing processes are detailed in inside-out competencies. Functional competencies are related to processes or functions within the firm. It involves consumer relations, also known as outside-in competencies and internal capabilities (employees) also known as inside-out competencies. Part 2 Foster’s market program is evaluated by use of the marketing mix (place, price, promotion, and product/service China is the target market, an emerging market in competition against multinational companies.
A core competency of a reasonable return on investment should boost its attempt to hit the China market. An execution of any business model may encounter challenges of institutional voids (Khanna et al., 2010). Instead of adapting to China’s model of business, Foster should adapt depending on knowledge acquired from the local market at Australia.
). In this foreign market expansion, strategies that are adequate for capitalizing on potential should include market potential assessment and access, market entry and market establishment. The original assessment of opportunities is particularly vital.
Early adopters and innovators are the aim of promotion while marketing educates potential customers and develops product awareness. The emerging market entrepreneurs would have an advantage over Foster’s Group by virtue of cultural familiarity and experience in dealing with institutional voids. A second likelihood to be considered is collaboration between Australia’s beer companies and their own products. If it makes sense and fulfills the purpose, then Foster implement all models possible for success. A lot of capital, talent, brands and additional resources could be added to China, as an emerging market. Price positioning would require that costs be kept in check, lower or at level with competitors in the emerging market.
The target group would be the price-sensitive customers, and internal efficiency would accomplish an advantage. Low prices would not be operating efficiently without a good quality of product backing. Another approach would be to hit high price campaigns while releasing an unrivaled product in the market. The brand needs to be something that customers would want to be associated. Quality positioning as high-grade supplier would demand quality assurance and assessment. Technical competence in manufacturing and engineering, outside-in competencies and market sensing are essential to bring success.
The supply chain administration should advocate for high quality inputs regardless of the costs. Higher costs are related to this and thus it would be best to market for customers who are willing to purchase high cost, top quality brands. A fast follow approach where mistakes made in the existing market are capitalized upon is increasingly successful. A more direct approach could also be used for advertisement as well as supply.
Innovations should be attempted, and modifications to customer preference tried out. This places them at a competitive edge as they enter the China market A needs-based benefit positioning approach identifies alternative segments within markets and focuses on providing consumer preference goods (Hooley et al., 2004). Service systems should assist service providers in customer service delivery and monitoring skills.
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