Assignment.4

Introduction In this assignment, we are going to focus on the chapter 1 which is Detailed Assessment and Planning. In this chapter, Sun Zi had focus on the thorough analysis before the war. In the modern management, it can be describe as the planning for the organization goal and objectives. To achieve an organization goal, a well planning is very important. Meanwhile, we are using the ASTRO as our company reference. ASTRO is Malaysia’s leading cross-media group with significant presence in DTH (Direct-To-Home) TV services, commercial radio and TV programming. ASTRO, the subscription TV service began operations in 1996 with 22 channels and currently broadcasts over 125 pay-TV channels on four major languages. After the launch of the MEASAT-1 satellite as part of Malaysia's commercialisation of space, ASTRO commenced broadcasting in 1996 with an initial bouquet of twenty-two television and eight radio channels; four of which were its own channels. In August 2003, a new logo was launched, the uppercase ASTRO was changed to the lowercase ASTRO, with the slogan "Making Your Life Richer". On the business front, ASTRO turned in an encouraging performance in FY2010. They grew their revenue by 10% to register a record RM3.3 billion, while Group EBITDA rose 24% to RM831 million, or a margin of 26%. In Malaysia, the Group’s multi-channel television business gained some 284,000 net new customers giving us a total customer base of 2.93 million households or 49% penetration of total Malaysian TV households at the year’s end. In December 2009, ASTRO launched ASTRO Beyond, their next generation TV service platform, featuring Malaysia’s first High Definition (HD) broadcast which will be followed by a range of other new services designed to significantly increase our customer’s viewing choices. Their radio business delivered 1.3% revenue growth in a challenging market and confirmed their position as the No. 1 radio network in Malaysia.

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Content The Sun Zi Art of War is one of the oldest and most complete and reputable book of military strategy that has survived to date. It was written by Sun Wu in the 6th century BC, during the spring and autumn period. Sun Wu is recognized as a Master of Military and we called him Sun Zi. The Art of War has an influence on Eastern military thinking, business tactics, and beyond. In this book, Sun Zi suggested the important of the planning and positioning in strategy. In the eyes of Asians, the marketplace is a battlefield. A military strategy is held to be very useful guiding business activities. Many Asian business leaders have attached to the classical Chinese military strategies. It is also many of the principles behind these strategies are even commonly applied to daily life. Doctrine and Law Doctrine and law refer to organization and control, management systems and procedures, and the command and control structure for the development of the resources. Every organization has its own rules and policy which apply to their organization culture, so that staffs will follow the rules and policy of the organization. Although laws is dead, but it’s also changed or amended according to situation or environments. Organizing typically follows planning and reflects how the organization tries to accomplish the plan. Organizing involves assigning task, grouping tasks into departments, delegating authority, and allocating resources across the organization. Every organization has its strengths and weaknesses, so the leader of the organization needs to understand the organization strengths and weaknesses, so that they can assign the tasks for the right person. It can let the organization it can achieve the organization goals with effectively and efficiently. Organizing also refers to coordination of employers, human resource departments need to coordinate the right people to the right tasks according to the employees’ skills and ability. It can save the resources of organization and also enhance the productivity of the organization. Every organization has its own organization system (compensation scheme) and organization chart. Organization use system in planning, organizing, leading and controlling the organization. Organizational chart is a chart which represents the level of the organization employees throughout the organization. Usually at the top of the organization chart represent the highest authority within the organization, which planned for the long term goals for the whole organization. Organization chart show who 2

controlling who within the organization, from top level managerial role to non managerial role. Weather Sun Tzu said: “Heaven signifies night and day, cold and heat, times and seasons.” It refers to the contrasting changes of day and night, cold and heat, times and seasonal changes. Although in warfare conditions the climate can be one of the most uncontrollable factors, a good general will know to utilize them most advantageously. Sun Tzu’s military mind this well. He will pick the most opportune moment to fight, using the bad weather in such way that it causes the most harm to the enemy. On the battlefield of war, certain changes in reality could be predicted, from seasonal opportunities convert to advantages. But, many factors could not be predicted. As a modern military cliché goes, “the best laid battle plan is tossed out when the first shot is fired”. Thus, the victorious army is that which embraces such unpredictably and can respond accordingly. For business, company also has to grapple with climatic conditions, such as the “economic climate” and “business climate”. Among these conditions are: • Political situations, such as stability, ethnic conflicts, and wars; • Economic cycles, such as booms, recessions, and stagnation; • The investment climate, such as government policies, regulations, the state of technology; • Consumer trends; • Other related social and cultural factors, such as changes in demography; To be competitive, a company has to capitalize on the various changes in the economic and business environment and formulate its strategies accordingly. As in military situations, a company must realize that these environmental variables are beyond its control. It can neither command the fluctuations of economic or business environments nor dramatically affect social or cultural norms. A general must know how to fight within the constraints of climatic conditions, and a CEO of a company also has to adapt strategies for environmental constraints. On the other hand, a good general or CEO knows how to choose the best time and 3

turn these conditions into advantages. An import substitution policy, for example, may hamper market entrance but at the same time provide opportunities for investment, which can result in access to the closed market. Terrain According to Sun Zi, Terrain refers to whether the route to be taken is long or short, whether the ground is treacherous or safe, wide or narrow with regard to ease of movement, and whether the ground will determine the death or survival (of an army). In the corporate world and a company, planning by CEO is very important in making any decisions. Planning means the management function concerned with defining goals for future organizational performance and deciding on the tasks and resources needed to attain them. The purpose of planning is to help the organization achieve higher performance and to remain alive. The overall organizational performance depends on achieving outcomes identified by the planning process. Managers involve people throughout the organizational, which can encourage higher performance because people understand the goals and the plans. Lack of planning or poor in planning can hurt an organization’s performance. Top managers’ lack of vision in perceiving market direction and weak planning efforts regarding rapid expansion and franchisee relationships has seriously damaged once successful firm. So, in order to achieve high performance, they need planning indeed. Generalship A good general, according to Sun Tzu, should possess five important qualities which is wisdom, trustworthiness, benevolence, courage and discipline. By wisdom, he meant the ability to observe the circumstances and the ability to analyze and judge the situations. Trustworthiness concerns the ability to win the complete trust of armies. Benevolence, according to Sun Tzu, a general should have the ability to sympathize with army’s problem, and true concern for their well-being. Courage requires a general to be brave, decisive, and able to gain victory by taking advantage of opportunities without hesitation. Discipline concerns the ability to implement discipline and give punishment so armies not dare to violate commands and rules.

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These qualities of generalship can be used to measure corporate leadership. A corporation is similar to an army organization. A powerful and efficient leader is very important to the success of a corporation. The five positive qualities of Sun Tzu’s generalship are needed by an organization CEO. A good CEO can be expected to have a combination of the following qualities: •

Broad knowledge with the capability to identify business trends and opportunities;

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The ability to establish mutual trust between management and employees;

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The capability to delegate power and how to tolerate employees’ unavoidable mistake; 1. Benevolence that understands the problems of employees and cares about their well-being;

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Moderate amount of compassion, to avoid the problem occur;

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Dare to make risky decisions but not making hasty or reckless decisions;

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The ability to combine strict discipline, meting out punishment decisively and fairly.

Generalship is important to influence their employees to adopt the new behaviors needed for new strategy implementation. Trustworthiness can persuade the employees help to achieve the goal and get support from employees. Besides that, according to Sun Tzu, a good army always has stringent discipline, which it can achieve with an efficient reward-and-punishment system. A good leader should know how to and when to reward or punishment. Employees must be treated with humanity but kept control under company rules and discipline. Moral Law Moral Law (Tao) which stands for “philosophy”, is one of the factor of Sun Tzu’s principles. Sun Tzu meant that the moral influence is the way in which people are able to be in good accord with their ruler. If the ruler is wise, he must first acquire the moral support of his subjects which will help him to win. In order to adapt the moral influence among the troops, Sun Tzu meant that the generals and soldiers must share the same goals and difficulties and the ruler should take care and treating the interests of his subjects as his own family members. 5

Moral Law can form the uniting force in a competitive organization. Moral Law helps to attract customers, employees, supporters and other associating allies. The Moral Law causes the people to be in complete accord with their ruler, so that they will follow him regardless of their lives, undismayed by any danger. Moral Law is causes the people to have the same thinking as their superiors. For example, only when the objectives of manager and employees are the same, they will only work together to achieve the objectives. Besides that, when the instructions are easy to understand and follow, the employees will only fully obey the rules. Every leader in an organization must have the good characteristics such as justice, responsible and honorable. This is because employees will only feel satisfy if they are leading by a good leader. For example, a good leader will admit his or her mistake instead of blaming around the employees if the leader did wrong decisions. By this way, employees will feel that they are treated fairly by the leader and they will do the task with putting more efforts. To achieve this goal, Sun Tzu emphasized one very important principle: If a general treats his soldiers as his own beloved sons, they will stand by him until death. So, in a extremely competitive business world, managers should formulate a common corporate goal which to be shared by all employees, so that all in the company will view themselves as the member of the group crossing the river in the same boat. The employees would more likely consider company affairs and be willing to make personal sacrifices when needed to help the organization. By this way, a company can make its very strong competitive advantage and survive in fierce competition.

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Discussion Doctrine and Law The ASTRO Group have their control environment to control the employees in the organization, ASTRO Group use organizational structure, limits of delegated authority and documented policies and procedures. Organizational structure The roles and responsibilities of the Board, Board Committees and management are clearly defined to ensure proper identification of accountability and segregation of duties to promote effective and independent stewardship in the best interests of shareholders in particular, the Audit Committee comprising wholly of independent non-executive directors is responsible for reviewing the integrity of the Group’s financial reporting process, risk management process and control systems. Limits of delegated authority These specify the levels of authority delegated to authorize management for capital commitment and operational expenditure on behalf of the Group. The limits are reviewed and updated regularly to reflect business, operational and structural changes. Documented policies and procedures Policies and procedures relating to finance, procurement, human resource and information systems for operation units within the Group have been established and are revised as needed to meet changing business and operational needs. Accounting systems and financial processes are governed by the Group Finance Manual.

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Weather The ASTRO Company has practiced on the theory of weather in the Sun Tzu’s art of war. ASTRO Company had capitalized on the various change in the economic, technology and competitive environment. Economic Condition Changes in economic conditions, whether global or local, may adversely impact consumer sentiment and spending, thereby affect the ASTRO company financial performance, whilst global economy has emerged out of recession, the ASTRO remains vigilant and closely monitors economic conditions in the countries in which it operates or has invested, and constantly ensure that this strategy are optimized for existing circumstances Technology and Innovation Technology and innovation are critical to ASTRO’s business and industry. The ASTRO is cognizant of the latest industry trends and has upgraded its facilities to enhance security and preparedness amid the emergence of new technologies such as high definition television. The ASTRO has also taken steps to reduce technical and operations disruptions while ensuring its system remain current and relevant through continuous maintenance and system upgrades. Competition Competition can range from other leisure activities that complete for the customer’s wallets to existing media and telecommunication players which may offer appealing products and services, and technology development that may result in consumers deriving content from alternative sources such as broadband video and IPTV. ASTRO is cognizant of critical industry developments, changes in customer’s preferences and considers key performance indicator such as rating and viewership in its products planning and development. Terrain ASTRO have a good planning before go for any progress. As ASTRO continues to strive to make a difference, they plan to keep mind that the success of each initiative that they choose to undertake can only be achieved with the support of their diverse and numerous stakeholders.

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Meanwhile, ASTRO plans to seek to engage their many subscribers, listeners, readers, on-line visitors and customers. Despite the numerous changes and challenges that the Company continues to face, ASTRO’s commitment towards long-term sustainability has never wavered. ASTRO has a good plan which is the five core responsibilities to ensure the long term sustainability of the company: •

Creating Responsible Content

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Engaging Stakeholder Positively

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Ensuring Ethical Conduct

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Cultivating Uninhibited Creativity

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Investing in the company

By matching up the five responsibilities, ASTRO plan well to make much effort to take on these responsibilities. First, they take every effort to ensure that the content that they provide is wholesomely educational, entertaining and compliant with the rules set before. Next, they continue their effort to understand ,engage and support the numerous and diverse organizations. Then they take seriously to uphold good ethics and sound corporate governance to ensure compliance with the laws and regulation within their operates. After that, ASTRO as a leading content creator relies on its employees to do their best, to make the right decisions, to maintain high standard and so on and all are undergo a good planning. Last, ASTRO in a position to make a difference in the community via learning, environment and sports. ASTRO always plan well and put much effort to take in their responsibilities in term to produce a better and a higher quality’s outcomes. As ASTRO continues to keep in mind, they have a plan well first before making any decision and progress. Law Due to the numerous changes and challenges that the ASTRO continues to face, ASTRO’s commitment towards long-term sustainability has a mission to ensure the long term sustainability: Become Malaysia first leading service provider 9

Since, many people start to use online streaming to watch movie, this will bring the ASTRO a great loss. ASTRO has decided to provide more services or promotions such as: ASTRO on demand which can watch the latest drama with flexible time on cheaper price. This can allow ASTRO build a strong competitive advantage because of the streaming speed of the Malaysia is slow. By setting this mission, ASTRO leaders and the employees must have the same thought to ensure the mission can be achieved. We can see that mostly there will be an ASTRO fair at any kind of shopping mall or crowded places. This is to allow people to sign up the promotion that ASTRO having. This need the corporation of leaders and employees because of the location which placing the fair is the responsibility of the managers, meanwhile the people who making sales at the fair are the employees. Both roles also need to work well only the goal task can be done. If the location chosen, is not strategic, there will be very less or no sales at all. Besides that, employees who succeed in making people to sign up, ASTRO will pay the worker a bonus income. Leaders and managers must have very good characteristics to ensure the employees are willing to follow the instructions of the managers. This only can be achieved where managers and employees working well together. This kind of rules has met the Sun Zi meant that the generals and soldiers must share the same goals and difficulties and the ruler should take care and treating the interests of his subjects as his own family members.

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Recommendation Although ASTRO had monopolized the market for more than 15 years in Malaysia and successfully earned a satisfied figure on profit, but their business strategy was yet to be improved. Recently, When ASTRO announced that they will charge more for their services; a lot of people were against it and even start a petition. Actually it is not that bad for the bill to increase from RM 78.95 to RM 88.95 which includes family, learning, movies, fun and news package but people are just extremely mad about this and quit the subscription. The main reason people are mad about this is due to their bad reception during the raining days. Whenever the weather is bad, subscriber will not be able to get a single picture on the TV. Besides that, Advertisements in ASTRO are just like those in free TVs. In most people perception, subscribed TV should be free from advertisement in the first place but since ASTRO have good advertisement revenues, why still they need to charge more for their bad services. From this example of bad decision making by ASTRO, we would like to give some recommendations for ASTRO to improve their services. First of all, we believe that ASTRO had already tried their best to solve the reception problems during the bad weather, yet the problem still couldn’t be solved. Therefore, we suggest that ASTRO should implement the broadband TV technology to provide an alternative way to receive broadcast TV program from ASTRO or even replace their current satellite dish. The benefit of using broadband to 11

broadcast TV channel is that the reception would not be affected by weather since the transmission is done underground and it will reduce the cost on reception device since broadband TV required subscriber to have an internet connection before subscribe. Besides that, there are already a few telecommunication companies in Malaysia planned to launch this service soon. By that time, more competition will arise for ASTRO. If ASTRO remain seated and does not react to these changes on external environment, they will be eliminated from the market very soon.

Conclusion ASTRO is a company which wants to become a leading television channel in Malaysia. ASTRO has enough resources and labor forces but they only planned five factors averagely; this is not enough for a growing organization. As the ASTRO is continuously expanding and getting involved in shares market, ASTRO need to plan very well in five factors and try to improve in diversity ways to ensure the company stays strong in competitive business world; ASTRO can implement the recommendations which we recommend which can strengthen their services. Although, the online streaming services and the increased monthly fees cause ASTRO faces a very big problem such as customers started to unsubscribe the services from ASTRO; ASTRO still has their strengths such as some people still prefer watch television compared with the computer. ASTRO is a very organized company and leading by a very good team management; besides that, the employees of the ASTRO are capable and willing to put effort to the organization, we believe that ASTRO can achieve their mission which becomes Malaysia first leading service provider if they plan and organize the five factors nicely compared with the current planned 5 factors.

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References ASTRO all Asia networks plc (n.d.) Retrieved November 15, 2010 from http://www.ASTROplc.com/09/ Homepage of ASTRO (n.d.) Retrieved November 15, 2010 from http://www.ASTRO.com.my/ Sun Tzu the Art of War (n.d.) Retrieved November 15, 2010 from http://www.chinapage.com/sunzi-e.html Sun Tzu the Art of War (n.d.) Retrieved November 15, 2010 from http://www.easy-strategy.com/art-of-war-1.html Sun Tzu's strategic thinking and contemporary business (n.d.) Retrived November 15, 2010 from http://findarticles.com/p/articles/mi_m1038/is_n2_v37/ai_15419781/pg_8/? tag=content;col1

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