ABDT5134 SMDM

TUTORIAL 1 ANSWER

9/27/2011

Question 1
Management need to determine their capabilities that are capable of providing superior customer value, and are difficult to copy by competitors.

Question 2
A mission statement is clear and considers statement (at most 2 paragraphs) that explains the organizations reason for existence. An organizations vision ends to be future oriented; it represents where the organization is headed and where it wants to go.

Question 3
The leadership between the corporate strategy and the strategies of its strategic business units (SBU) is a reinforcing one. The decision makers for each SBU must select strategic for implementing the corporate strategy and producing the results that corporate management expects. Corporate level management, on the other hand should assists SBUs in achieving their objective. Corporate strategy and resources should help a SBU to compete more effectively than if the unit operates on a completely independent basis. Corporate resources and synergies help the SBU establish its competitive advantage. The strategic focus and priorities of corporate strategy guide SBU strategies. Finally, top managements expectations for the corporation indicate the results expected from a SBU, including both financial and non-financial objective. In effect, the SBU are the action centers of the corporation.

Question 4
i. ii. iii. iv. v. vi. vii. viii. ix. Unique competitive position for the company Activities tailored to strategy Clear trade-offs and choices vis--vis competitors Competitive advantage arising from fit across activities Sustainability coming from the activity system, not the parts Operational effectiveness as a given

ABDT5134 SMDM

TUTORIAL 1 ANSWER

9/27/2011

Question 5
The company needs to consider the product and the market involved. A single product market can offer the advantage of specialization. The company can become very experienced in the environment, competition, and market situation facing the core business. However, remaining with the core business may be risky, since the company is totally depend on a single set of customer needs. If the customer need changes, the company may be unable to respond, therefore, many companies eventually expand business operations into new business areas. A company can expand in 3 ways: 1) new market for existing products, 2) new product for existing market, 3) diversification. Each alternative can give the company a broad and safer base. Developing a new market with existing products and developing new products for current market take lower risks as compared with diversification. Diversification is a popular option for corporate development. Diversification can take place through internal development or acquisition. Internal development may be expensive, and dangerous, if the company is inexperienced in the new area. Acquisition may also be costly, but the principal risk is the integration of management teams and strategies. The major risk in diversification is that one the new business is establish, and operational, there is the risk that the new business will not be a success, thus the larger expenditure of resources will be wasted. However diver4sification of the business mean less risk for the business provided it has the capabilities and resources available. Of the core business suffers a bad year; the losses are partially confined success of diversification. A diversification if successful is attractive revenue for growth since it reduces the dependencies of the core business on a single set of consumer needs.

Question 6
I. Situation analysis Market and competitor analysis Markets need to be defined so that buyers and competition can be analyzed. For a market to exist, Mr. Lee must identify people with particular needs and products. He must then fulfill these needs with products. Buyers must be willing and able to purchase this product. Market segmentation Look at the nature and extent of diversity of buyers need and wants in a market. Mr. Lees objective is to examine differences in needs and wants of customers and to identify the segments sub groups within the product-market of interest. Continuous learning about markets

ABDT5134 SMDM

TUTORIAL 1 ANSWER

9/27/2011

II.

III.

IV.

Mr. Lee must be able to sense what is happening in the market and what is likely to occur in the future according to competitive threats beyond industry boundaries. He must develop strategies to seize opportunities and counter threats, and to anticipate what the market will be like in the future. Designing marketing strategy Customer targeting strategies Me. Lee must select the people that he wishes to serve in the product-market. This decision is the focus of the marketing strategy since targeting guides the setting of objectives and developing a positioning strategy. Customer positioning strategies Mr. Lee must choose a combination of product, channel of distribution, price and promotion strategies to position himself against his key competitors in meeting the needs and wants of the target market. Marketing relationship strategies The driving force underlying these relationships is that Mr. Lee may enhance its ability to satisfy customers and cope with a rapidly changing business environment through collaboration of his suppliers, distributions, and customers. Planning for new products Mr. Lee must closely coordinate new product planning since it is essential to satisfy customer requirements and products with high quality at competitive prices. New product decision include finding and evaluating ideas, selecting the most promising for development, designing marketing programs, market testing the products, and introducing them to the market. Marketing program development Mr. Lee must shape each of the following strategies into a coordinated plan of action in order to be effective. Product The product is the machine that can help to save energy. Distribution Mr. Lee needs to decide the type of channel organization to use, the extent of channel management, and the intensity of distribution appropriate for his product. Price Mr. Lee must choose the role of price in his positioning strategy, including the desired positioning of the product or brand as well as the margin necessary to satisfy and measure distribution channel participants. Promotion Mr. Lee must choose activities, such as advertising sales promotion, sales force, direct marketing and public relations that perform as essential role in communicating the strategy to buyers. Strategy implementation and management Organizational design

ABDT5134 SMDM

TUTORIAL 1 ANSWER

9/27/2011

Mr. Lees organizational design must match people and work responsibilities in a wa that is best for accomplishing the marketing strategy. Marketing strategy implementation and control Mr. Lee must prepare the marketing plan and budget, implement the plan and use the plan to manage and control the strategy on an ongoing basis. The marketing plan includes action guidelines for the activities to be implemented, who does what, the dates and location of implementation and how implementation will be accomplished.