BSBMGT616ADEVELOP AND IMPLEMENT STRATEGIC PLAN

BSB60407 ADVANCE DIPLOMA OF BUSINESS MANAGEMENT

ASSIGNMENT

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BSBMGT616A DEVELOP AND IMPLEMENT STRATEGIC PLAN

Submitted by: Gurkirat Singh Date 28/11/2014

PART A ORGANISATIONAL REVIEW (REPORT WRITING)

Objective of report: Review organisations vision andmissionby reviewing case study and describe organisation planning process by providing inputs wherever possible.

Scope of report: Vision and mission of organisation, current approaches to obtain the objectives of organisation and organisational values.

Existing Vision and Mission Vision To provide customer best café going experience

Mission To open additional café in NSW and Queensland and to become national brand and be recognised as a integral part of hospitality industry.

Current Approaches  Engaging customer and customer research  Developing and improving product and services

Revised vision and mission Vision To be more innovative and find new ways to increase efficiency of processes and effectiveness of customer solutions Mission To embrace strategic alliance and seek out new partnerships

Organisational values  To identify community needs.  Participate in local community.  Donate certain % profit to community.

Notes on meeting with Stakeholder  Development of new areas which were not recognised at the time of previous planning.  To be innovative and motivate self-directing teams.  To participate in community.  Develop strategic alliance and partnerships.

PART B ENVIRONMENTAL ANALYSIS PEST ANALYSIS:It consists of analysis of political, economic, social and technological environment of organisation. Political  Tariff on import of espresso machines will be removed.  Strong possibility of introduction to impose carbon tax on all energy intensive products used for commercial use. Economic  Strengthen of Australian dollar against trading partners in coming years. Social  Lifestyle trend to eat out is becoming more affluent and frequent.  Steady population growth rate. Technological  New espresso machines are developed which use 30% less energy.  Home market for espresso machines is experiencing high growth.

Value chain analysis Inbound logistic:Lack of experience personnel for custom and importation. Operations: State of art Management information system provides for internal control and strategic planning.

Outbound logistic: Contracted Delivery Company is not able to deliver machines on time due to fast expansion plans. Sales: Marketing and sales department are doing quite well and are strong points for profit well massage can be expanded using internet. Service: Macville enjoys good reputation for after sales services to customers.

SWOT ANALYSIS

Strengths  Good reputation after sale services  Excellent advertising and marketing mix.  State of art Management information system.

Opportunities  Use of internet for advertisement.  Withdraw of competitor from new Sydney market.  Increase in population growth rate.

Weakness  Poor performance of contracted delivery company.  Lack of experience personnel to deal with import and custom.

Threats  Raising interest rates could decrease disposable income  Nufix.inc a global corporation entering in espresso machines and bean market.  Bean ex coffee supplier is entering in espresso machine market.

Existing / potential competitor 1. Nufix inc. It is shifting from instant coffee to espresso machine and coffee Strengths Marketing, Finance and Human resources Weakness Difficulty in adopting to need of niche market

2. Bean ex Coffee bean trader is going to import expresso machine for their wholesaler clients. Strengths Easy entry to market Weakness No established service department to provide after sale services to wholesale clients.

Potential alliances As required in tenders

1. Businessname: Home espresso trades Description of business (includes vision of Macville ) To sell espresso machines to home customers in Sydney Description of joint business:Shared space in four trade fairs. Strengths Home consumer market compliment commercial consumer market.

Weakness Alliance also focuses on non-hospitality sector. Risk  Partner not fulfilling financial commitments  Partner access to Macville trade secrets  Association with non-industry partner may impact negatively on customer base

2. Business name: Ambrosia coffee roast Description of business: Sell all grades of coffee beans. Description of joint venture business: Share of outdoor advertising cost at café outlets. Strengths Sharing of client base Weakness Product image is commodity based. Risk  Association with poor quality brand.  Long term signage of alliance. 3. Businessname: Java Estate Description of business:To sell quality Arabica coffee beans in all states of Australia. Description of joint venture business: provides espresso machines to clients at no charge. Strengths 100% committed to hospitality and coffee bean market. Weakness

Other coffee bean supplier may not recommend Mac villecoffee machines with this strong alliance. Risk Concern over outstanding amount

PART C STRATEGIC PLANING (PROJECT PLAN BREIFING)

Organisation Objectives 1.To sell and service espresso machines in all states of Australia by accepting java estate tenderand to look for warehouse opportunity in other high volume estates 2.To increase profit margin by 10% from benchmark set in 2010. 3.To establish Macville brand recognition in key markets in next five years. 4.To reduce energy wastage by 10% from benchmark set in 2010.

Organisation objectives and strategies to achieve objectives Objective1.To sell and service espresso machines in all states of Australia by accepting java estate tender and to look for warehouse opportunity in other high volume estates Strategies (In priority order) a. Sign action and establish strategic alliance with Java estate.  KPI Plan:To install 200 machines per annum. b. Establish Macville warehouse.  KPI Plan:To open warehouse in Melbourne after Sydney opens for business.

c. Set agents in other states and outsource maintenance contracts.  KPI plan:Set agents in other states and outsource maintenance contracts in South Australia. Parties responsible Project manager

Objective 2.To increase profit margin by 10% from benchmark set in 2010. Strategies (In priority order) a. Instigate bulk buying negotiationsto reduce prices of suppliers.  KPI Plan 100% purchases by bulk load. b. Operate all departments at optimum capacity and productivity.  KPI plan wages to turnover ratio of 12.5% Parties responsible Purchasing manager Operation manager Objective3.To establishMacvillebrand recognition in key markets in next five years Strategies (In priority order) a. Establish social and internet network marketing.  KPI plan 1000 clicks on the website per day. b.Join with java estatein cobranding cups and banners  KPI plan100% café using our machines use our cups. Objective4.To reduce energy wastage by 10% from benchmark set in 2010 Strategies (In priority order) a. Set up innovation and reward program

 KPI plan 25 suggestions and 6 innovations introduced every year to reduce wastage. b. Develop and implement energy use awareness program.  KPI plan kW per person use to drop by 10 kw Parties responsible Research and development manager Human resource manager

Part D Reviewing implementation (Report writing) Objective of report To prepare are a report describing the implementation of strategic planning as measured by achievement of KPI’ S, milestone and overall effectiveness of organisation. Scope of report To measure performance of organisation against KPI and Milestones and provide recommendations and refinements for implementation process KPI Progress KPI Plan  To install 200 machines per annum  To open Melbourne warehouse  To assign agent and outsource maintenance

KPI Actual  Only 198 machines are installed  Melbourne warehouse is still not open.  Still no service contractors for Northern

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contractor for Northernterritory, South Australia, ACT, Western Australia, Tasmania. 100% order by container load Wages to turn over ratio 12.5% 1000 clicks per day on website 100% café using Macville machine to use our cups 25 suggestions and 6 new innovations to be introduced. To reduce energy waste 10kw per person

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territory and agents assigned for other states like WesternAustralia are very expensive. All order was by 100% container load. 13.8% wages to turn over ratio achieved 12000 clicks per day. SEO was very experienced. Survey shows only 50% uptakedesign and colour not attractive. 30 innovations and 8 new innovations introduced. 12 kw energy consumption per person dropped

Milestone Progress

1. Objective Macville machines are installed in all states except in northern territory because taking time to hire agents and maintenance contractors. 2.Objective Profit margins have only increased to 2% in two years. Some agents and contractors are very costly. 3.Objective50% of target market recognise brand and 855 had a positive reaction. 4. Objectives reduction in energy wastage is 2% against 2010 set benchmark.

Overall progress Organisation is performing well profit margins have already increased by 2% in last two years as bulk buying’s were instigated at earlier stage due to initial

increase in demand.Marketing objectives set are already achieved using, social internet and networking marketing strategies. However strategies are not implemented properly in Northern Territory organisation is facing difficulty in hiring agents and maintenance contractors.Energy reduction strategy working well however it was implemented too late which resultedreduction in energy to only 12 kw per person.

Improvements Increase pay rate in Northern territory to attract experienced agents and machine maintenance contractor. To increase profit margin warehouse should be open at Melbourne at earliest because it is running at expensive agency model.