CASE STUDY

-By Bhupinder Singh Makan

SWOT analysis
Q.1 Describe what is meant by a SWOT analysis
- SWOT analysis (alternatively SWOT Matrix) is a structured planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture.

SWOT analysis can be carried out for a product, place or person. By focusing on the key factors affecting your business now & in the future, a SWOT analysis provides a clear basis for examining your business performance & prospects. Hence, setting the objective should be done after the SWOT analysis has been performed. This would allow achievable & realistic goals or objectives to be set for the organization. What is SWOT? 1. Strengths: Internal attributes that is helpful to the organization to achieving its objective. For most businesses, strengths will fall into four distinct categories i.e. Finances. Marketing Management and personnel skills Strengths in production 2. Weaknesses: Internal attributes that is harmful to the organization to achieving its objective. Your weaknesses are often known but ignored. A SWOT analysis should be the starting point for tackling underperformance in your business Poor financial management Lack of marketing focus Management and personnel weaknesses Inefficient production

CASE STUDY
-By Bhupinder Singh Makan 3. Opportunities: External factors that help the organization achieve its objective. External changes provide opportunities that well managed businesses can turn to their advantage. Changes involving organizations Broader business environment

4. Threats: External factors that are harmful to the organization to achieving its objective Threats can be minor or can have the potential to destroy the business. Changes involving organizations Broader business environment The results of SWOT analysis and the action needed will be different for every business. Capitalize on opportunities that play to your strengths. Address your weaknesses. Protect yourself against threats

Q.2. Explain the difference between internal and external factors.

1. Internal factor:-They are strengths and weaknesses internal to the organization Internal Factors are Management Decisions on what sort of business the company is in, quality of services or stock sold by the company. The internal factors may be viewed as strengths or weaknesses depending upon their effect on the organization's objectives. What may represent strengths with respect to one objective may be weaknesses for another objective. The factors may include all of the 4Ps; as well as personnel, finance, manufacturing capabilities. They are within the control of the business. 2. External factor: - The opportunities and threats presented by the external environment External Factors affecting the company include the Global Financial Crisis, government policies, and central bank interest rates. The external factors may include macroeconomic matters, technological change, legislation, and socio-cultural changes, as well as changes in the marketplace or competitive position. The results are often presented in the form of a matrix. They are outside the control of the business.

Q.3 Analyze ways in which IKEA has managed to minimize threats to its business
If a company is aware of possible external threats, it can plan to counteract them. By generating new ideas, IKEA can use a particular strength to defend against threats in the Market. It is a Strong global brand which attracts key consumer groups. It promises the same quality and range worldwide Its vision to create a better everyday life for many people

CASE STUDY
-By Bhupinder Singh Makan Strong concept based on offering a wide range of well designed, functional products at low prices. Democratic design reaching an ideal balance between function, quality, design and price. IKEAs Cost Consciousness means that low prices are taken into account when each product is designed from the outset. - These strengths contribute to IKEA being able to attract and retain its customers. - One way IKEA measures its strengths is the use of Key Performance Indicators (KPI). - KPIs help IKEA to assess the progress of its vision and long-term goals by setting targets and monitoring progress towards these. - It manages weaknesses and threats to create a positive outcome. - As we know about the threats of IKEA that are, 1. Social trends 2. Market forces 3. Economic factors

Social trends: IKEA is building online help to guide customers to a more sustainable life. -Here it can focus on home improvement in the slowing housing market. It supports customers with tips and ideas on its website to reduce their impact on the environment. -This will also save them money. Staffs are trained on sustainability, both on what IKEA is doing and how they can take responsibility to become sustainable for themselves. Market forces: IKEA is large enough to enjoy economies of scale. This lowers average costs in the long run through, for example, better use of technology or employing specialized managers. - Economies of scale also give a business a competitive edge if cost savings are then passed on to customers in the form of lower prices. - This puts up high barriers to entry for smaller companies entering the market. Economic factors: IKEAs low prices create appeal amongst its customers in tough financial times. - It is vital to keep prices as low as possible when the retail sector is depressed. -IKEAs pricing strategy targets consumers with limited financial resources. -Its products will also appeal to those with higher budgets through good quality and design. -The company must ensure that it is always recognized as having the lowest prices on the market in the future. Communication plays an important role here.

Q.4. Discuss the contribution of SWOT analysis to IKEAs business growth.

IKEA and SWOT analysis:- SWOT can be seen as a strategy tool- it helps to define activity necessary to defend your business against threats (e.g. theft fraud, risky loans if you're in financial services); similarly it helps to clarify whether your strengths weaknesses and opportunities are within or outside your organization. - Some argue that you should ensure that your internal strengths match your external threats and are used to seize opportunities. - Similarly beware situations where your threats are lined up against your weaknesses-that's a recipe for difficulties ahead. -One way IKEA measures its strengths is the use of Key Performance Indicators (KPI).

CASE STUDY
-By Bhupinder Singh Makan KPIs help IKEA to assess the progress of its vision and long-term goals by setting targets and monitoring progress towards these. An example of one of IKEAs KPIs is the percentage of suppliers that are currently IWAY approved. The IWAY is the IKEA Way of Purchasing Home Furnishing Products. This guideline defines the social and environmental requirements IKEA expects of its suppliers. Increasing use of renewable materials IKEA improved its overall use from 71% in 2007 to 75% in 2009. Smarter use of raw materials IKEA increased the use of recycled or reclaimed waste products in energy production across all stores from 84% in 2007 to 90% in 2009. - By committing to buying large volumes over a number of years IKEA can negotiate lower prices. This also benefits the suppliers because they enjoy the greater security of having guaranteed orders. - there is a true business potential for IKEA in providing solutions that enable customers to live a more sustainable life at home. - IKEA is developing effective solutions for customers in order to support them recycling or reusing used products, aiming at no products ending up at land- fill and the recycled materials used in producing new IKEA products. - IKEA takes advantage of through its sustainability agenda a growing demand for greener products a growing demand for low priced products. Trends in the current financial climate may result in consumers trading down from more expensive stores demand for reduced water usage and lower carbon footprints. -IKEA has to acknowledge its weaknesses in order to improve and manage them. This can play a key role in helping it to set objectives and develop new strategies. IKEAs weaknesses may include: - The size and scale of its global business. This could make it hard to control standards and quality. -The need for low cost products. -This needs to be balanced against producing good quality. - IKEA needs to keep good communication with its consumers and other stakeholders about its environmental activities. a Company is aware of possible external threats; it can plan to counteract them. By generating new ideas, IKEA can use a particular strength to defend against threats in the market. Threats to IKEA may stem from: Social trends such as the slowdown in first time buyers entering the housing market. This is a core market segment for IKEA products market forces more competitors entering the low price household and furnishings markets. IKEA needs to reinforce its unique qualities to compete with these economic factors the recession slows down consumer spending and disposable income reduces.

CASE STUDY
-By Bhupinder Singh Makan

CORUS
1. Describe what is meant by continuous improvement. Kaizen is also called as continuous improvement (CI). This focuses on making small continuous improvements across all functions, systems and processes within a business. It is also a process that, when done correctly, humanizes the workplace, eliminates overly hard work ("muri"), and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes Continuous improvement contributes towards lean production. 2. Explain the link between continuous improvement and new product development. In business and engineering, new product development (NPD) is the complete process of bringing a new product to market. The stages considered for NPD are Idea Generation is often called the "fuzzy front end" of the NPD process. Ideas for new products can be obtained from basic research using a SWOT analysis (Strengths, Weaknesses, Opportunities & Threats). Market and consumer trends, company's R&D department, competitors, focus groups, employees, salespeople, corporate spies, trade shows, or ethnographic discovery methods (searching for user patterns and habits) may also be used to get an insight into new product lines or product features. This involves lots of Brainstorming. Idea Screening: - The objective is to eliminate unsound concepts prior to devoting resources to them. Concept Development and Testing: - Develop the marketing and engineering details. Business Analysis: - Estimate likely selling price based upon competition and customer feedback. Testing: - Produce a physical prototype or mock-up & test the product in typical usage situations. Technical Implementation i.e. New program initiation Commercialization (often considered post-NPD) i.e. Launch the product New Product Pricing Impact of new product on the entire product portfolio

Role of KAIZEN in NPT: - Although continuous improvement usually focuses on small increases, company should establish systems and quality procedures helped it to meet step change. It is also a process that, when done correctly, humanizes the workplace, eliminates overly hard work ("muri"), and teaches people how to perform experiments on their work using the scientific method and how to learn to spot and eliminate waste in business processes. CI can be used to support its new product development (NPD), enabling it to meet the needs of its customers more closely. Developing innovative products through continuous improvement is at the heart of any business strategy. Continuous improvement contributes towards lean production.

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-By Bhupinder Singh Makan 3. Using examples, analyze the importance of lean production principles for each of Corus internal and external stakeholders. Lean production occurs where: Waste has been minimized. The flow of work is smooth The business is focused on customer needs. How are the Stakeholders: individuals and groups with an interest in an organization and the decisions it makes. Internal Stakeholders Employees Inverstors External Stakeholders Government Customers One aspect of lean production that helps to save costs of stock is the just-in-time (JIT) principle. Justin-time means producing and supplying goods at the time they are needed the business holds the minimum amount of raw materials and just enough finished product to meet demand. It requires wellorganized systems to ensure supplies arrive and goods reach customers on time. This reduces costs and so helps to improve the return on investment for shareholders. e.g. By Continuous improvement of quality of steel to match the requirements of Royal Navy without decrease in quality & manufacturing in a cost effective Corus has not only benifited its internal stakeholders but also its its external stakeholders.

4. Evaluate how Corus could use developments through the processes of continuous improvement to meet the needs of new groups of customers for its steel products. Continuous improvement has helped Corus to meet the Royal Navys increasingly sophisticated requirements for high specification steel products.By using its existing CI procedures to guide its research and development and testing, Corus developed the new specification of steel required at a competitive price. Investment in new technologies and equipment, used alongside lean production techniques, enabled Corus to minimise levels of waste and reduce high manufacturing costs. It was able to meet deadlines, a vital element of making a business operations more competitive. Corus adopts a practice of benchmarking as part of its continuous improvement. However, in meeting these needs, it has also opened up other business opportunities. By winning this contract applying principle of CI , Corus is now able to make this higher grade Steel available as part of its product portfolio.

CASE STUDY
-By Bhupinder Singh Makan

UNISON-PEST
1. Explain the purpose and benefits of PEST analysis. PEST stands for Political,Economic, Social and Technological influences. Any any business/ventur is affected by the internal & external factors. Internal factors are ones that are within its control. PEST implies to external factors affecting any business/venture. An understanding of many external factors helps to decide which strategies and tactics were best for achieving the objectives Advantages of PEST analysis PEST analysis It provides an understanding of the wider business environment. It encourages the development of strategic thinking. It may raise awareness of threats to an organisatio's ongoing profitability. It can help an organisation to anticipate future difficulties and take action to avoid or minimise their effects. It can help an organisation to spot business opportunities and exploit them successfully. 2. Outline the factors that could lead to exploitation of migrant workers. Awareness about rights: Migrant workers are often unaware of their rights in the workplace. Language Barrier: The language barrier also affects migrants outside the workplace. It causes difficulties in shops, accessing housing and education and understanding the welfare system. Understanding Cultural Issues Not being able to understand cultural issues such as behavior and customs is another big factor. Together these problems make many migrant workers feel socially excluded from Englishspeaking co-workers Racist Attitude: They may also be exploited because of racist attitudes. They are often reluctant to complain due to fear of losing their jobs regarding complaint about their treatment by employers. 3. nalyse the factors which have led to increased immigration to the UK in recent years. Economical factor: They can earn a better wage in the UK than in their home country. For example, the average monthly salary in the UK in 2007 was almost 2,500 whereas in Poland it was 500. This difference in wages allows the migrants to enjoy an improved standard of living. The migrant workers are also able to send money back to their families who remain in their home countries. Social Factor: Standard of living. This leads to mgration of n no. peope inUK. Availability of Job: Jobs are available readily in UK than workers home country. 4. Evaluate the extent to which the UK economy benefits from migrant labour. According to government figures, the working output of new migration adds 0.5% to the countrys Gross Domestic Product (GDP). In 2006, this was equivalent to adding an extra 6 billion to the economy. One of the reasons why migration improves the economy is that it increases the size of the total labour market. Migrant workers fill several areas of the labour market where there are skills shortages or they do jobs that people in the UK do not want to do because the working conditions may be poor or wages low. Many business leaders express the view that migrant workers often have a more positive work ethic than domestic workers. Employing workers who not only have the necessary skills but who are also keen to work allows many businesses to achieve a competitive advantage.

CASE STUDY
-By Bhupinder Singh Makan

London 2012
What is a vision? How does London 2012s vision go beyond simply organizing the Weeks of the Olympic and Paralympics Games? Vision: a summary in words setting out what an organisation is seeking to achieve. It gives everyone involved in a venture orproject the same view of what is to be achieved.
1.

The vision for London 2012 is: to use the power of the Games to inspire change. The message is that everyone can be part of the London 2012 Olympic and Paralympic Games. The London 2012 vision will help people to understand that the Games are more than just a six-week event. What happens in the four years leading up to the Games and what takes place afterwards is just as important as the Olympic and Paralympic events taking place during the summer of 2012. London and the UK as a whole will benefit from hosting the Olympic and Paralympic Games. Economically, East London is being transformed. Thousands of new jobs are being created in the Olympic Park alone. Jobs and training opportunities will be available for local people and across the UK. Local residents are engaged in the planning of the Games and the benefits the project will bring afterwards.London 2012 provides a tremendous opportunity to create a force for good in society and this is reflected in its core objectives. It will extend the hand of friendship and encourage longer term participation in sport and cultural activity across the UK. 2. How do the values of London 2012 help to achieve its vision? LOCOGs values represent what the organisation stands for and reflect the spirit of the Olympic ideals. Its values are interconnected: Values can affect: who LOCOG chooses to do business with how it carries out its activities the behaviour of the people that work for the organisation. To achieve our vision we must be inspirational To do this we must be open and respectful Only by working as a team can we deliver something truly distinctive.

3. In what ways are the objectives set out for London 2012 SMART? The London 2012 vision sets out a broad aim for everyone to work towards. To be effective, objectives need to be SMART. SMART objectives enable an organisation to measure the effectiveness of actions taken and measure achievements. Specific - related to the organisation and clearly understood Measurable - progress can be measured Agreed - targets are agreed by those involved Realistic - the objective should be achievable but sufficiently demanding to motivate employees Time related - objectives should state by when they are to be achieved

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-By Bhupinder Singh Makan For example, one of the SMART objectives of the London 2012 transport strategy is to have 100% of spectators travel to the Games by public transport, by cycling or on foot. It is specifically related to the transport strategy. It is measurable because it is a target for 100% of spectators. The transport and infrastructure team involved in delivering the objective have agreed to it. In order to achieve this objective the transport infrastructure, particularly in East London where most of the sporting venues are located, is being re-developed in order to support this objective. This ensures that the objective is realistic and can be achieved in time. This SMART objective helps LOCOG to deliver on its overall objective to maximise the economic, social, health and environmental benefits of the Games for the UK, particularly through regeneration and sustainable development in east London. 4. Evaluate ways in which local schools can become involved in activities that embrace the Olympic and Paralympic Values. Provide young people in every school and college across the UK with the opportunity to .get involved in the 2012 Games, through being part of an exciting education programme support the promotion of the Olympic and Paralympic Values through the Get Set website. This contains games, resources, videos and a series of sponsor-led programmes all providing links to the Olympic and Paralympic Values. place young people at the heart of the process, involving them in project design, development and delivery. The Get Set team regularly consults young people to make sure that the programme meets their needs. showcase and celebrate examples of interesting, inspiring and innovative practice. For example, on the Get Set website there are a series of maps which provide stories and illustrations of what schools across the UK are doing in relation to the Olympic and Paralympic Values provide opportunities for committed schools, colleges, children and young people to be rewarded, recognised and endorsed for their hard work by encouraging schools to join the Get Set Network. This will create a network of schools and colleges working on projects inspired by London 2012 and the Olympic and Paralympic Values. The education programme is directly helping to meet LOCOGs objective of maximising the economic, social and health benefits of the London 2012 Games. LOCOG can measure the success of the education programme through the number of schools, colleges and young people registering on the Get Set website and comparing this against targets that have been set.

CASE STUDY
-By Bhupinder Singh Makan

SHELL
1. Using a diagram, illustrate the main internal and external stakeholders in Shell. Set these out in a chart that can be displayed on the classroom wall. Internal stakeholders are people who are members of the business organisation. They are involved from from within it and involved daily with it. External stakeholders are those people or groups who are involved with the businesses from the outside i.e. they do not work for or with the business or are involved in its day to day running.

Internal Stakeholders Director of Shell Board committee members Trustees Communications Employees

External Stakeholders Local Authority/council Customers Suppliers Media Special interest groups

2. Choose two groups of stakeholders and then describe ways in which Shell meets the needs of these two groups. Employees as stakeholders: They are influenced by Shell but also affect how Shell operates. The employees standard of work and commitment to health and safety and excellence is vital inorder to keep Shell as a leader in the energy field. Mistakes can be costly in terms of reputation and the livelihood of other employees. A priority at Shell is to respect people. It seeks to provide its staff with good and safe working conditions, and competitive terms of employment. This has a positive influence on employees as it keeps them safe and motivated. Suppliers as internal stakeholders: There are Shells partners in the chain of production for example in bringing petrol from the oil well to the petrol pump. Shell has a number of core values that are central to everything it does.

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CASE STUDY
-By Bhupinder Singh Makan 3. Why does Shell find out about the views of Interest groups and pressure groups? How can this information help Shell to make better decisions? Interest groups: an organised collection of people who seek to influence political decisions. Pressure groups: an organisation formed by people with a common interest who get together to further that interest.

Shell needs to work with a range of interest groups. These are decision makers and opinion formers. People and organisations in positions of influence make decisions and form opinions that can affect Shell. These include academics, government, media, non-governmental organisations (NGOs) business leaders and the financial community. They interact with Shell in different ways: governments Shell has operations in many countries across all regions of the globe. To gain approval to operate in these countries it has shown the host governments that it is operating in the right way. This includes creating jobs, paying taxes and providing important energy supplies. Shell is also working with governments to promote the need for more effective regulation on CO2 emissions. the business community Shell supplies to and buys from hundreds of other businesses. other oil companies Shell works in partnership on projects with many other oil companies. These include both competitors such as BP and Texaco, and partners such as government owned oil companies in the countries in which it operates. Partnership activities have included building new oil or gas supply lines and new refineries. NGOs are important bodies that influence decision-making. For example, Shell was considering drilling in 2008 for gas in British Columbias Sacred Headwaters (the source of three important rivers). These rivers provided a source of wild salmon and other natural resources. A number of organisations were set up to protect the Headwaters including Friends of Wild Salmon. Shell listened to their concerns and postponed further drilling work. the media it is essential for competitive companies like Shell to continue to operate in ways that receive positive press coverage from newspapers, television and magazines. This reinforces its position in the market and can help to attract new customers through a positive reputation. A pressure group is a group of people with specific aims and interests which tries to influence major decision makers like businesses and governments and raise public awareness about issues. Shell talks regularly with major pressure groups such as Friends of the Earth and Greenpeace about key issues such as how best to dispose of old oil rigs to minimise damage to the environment. It deals directly with specific pressure groups that are campaigning on local issues such as the preservation of animal and plant life in a particular area. For instance, it has invested over $800,000 (over 500,000) in establishing a research laboratory in Louisiana, USA, to help restore coastal erosion. This will preserve endangered bird and plant life both there and across America. Shell is dedicated to protecting human rights and helping communities. The search for oil and gas can take energy companies to places with poor human rights records. It treats each case separately using decision-making methods set out by the Danish Institute for Human Rights. If Shell chooses not to operate in these areas, this opens the door for less principled competitors to exploit workers in these countries. If it stays then it can be seen to be part of

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CASE STUDY
-By Bhupinder Singh Makan the problem. Shell will only operate in countries where it is able to follow its business principles. These principles set out what Shell stands for and define its behaviour and are published on its website. 4. Evaluate if it is possible for a business to meet the needs of shareholders, customers, employees, suppliers and society at the same time. How can a balance of interests be achieved? Shell believes that it will continue to exist and grow if it can balance the needs of stakeholder groups. Shell employs three criteria in making such decisions. It assesses whether: 1. the economic impact of the activity is likely to yield a good return for shareholders 2. the social impact will be suitable for employees and communities 3. the long-term effect of its activity will harm the environment. To avoid conflict, Shell sets minimum levels that must be met for all three areas before making a major decision or investment in any one. For example, when planning new activity on land that was previously used for other purposes such as timber, or agriculture, Shell looks to see if the longer term social or environmental impacts do not out weigh the financial return on that activity. Shell has resolved and minimised conflicts between its activities and its stakeholders through its clear strategies and commitment to corporate values. By setting minimum thresholds for decision making, it is able to balance its impact in economic, social and environmental terms. This ensures that no decision will affect one stakeholder group more than others.

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