Strategic Management of

Orascom construction
(Final Project)
November 2023
Presented to: Dr. Heba Sadek

Prepared By:
Emad Hossein El Habashy Reg. no: 21124147
Mohamed Radi Reg. no: 21121375
Mona Mohamed Lotfy Reg. no: 21124139

Mirna Farid Reg. no: 21124132

Ahmed Ali Reg. no: 21121378

Words Count: 10296

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 Contents
1 Introduction and executive summary 3
2 Orascom Construction Introduction 3
2.1 Company overview 3
2.1.1 Current Performance 4
2.1.2 Running Projects 4
2.1.3 Human Capital 4
2.2 Strategic Position 4
• Vision 4
•Mission 5
•Company Strategy 5
•Polices 6
•Objectives 6
2.3 Corporate Governance Structure 6
2.3.1 Audit Committee 7
2.3.2 Remuneration Committee 7
2.3.3 Nomination Committee 7
2.3.4 Strategy & Sustainability Committee 8
3 Environment Scanning 8
3.1 External Environment 8
3.1.1 Remote environment (PESTEL) 8
3.1.2 Industry Analysis (5 Forces Competition) 12
3.2 Internal Environment (Organizational Analysis) 14
3.2.1 Resource Based View 14
3.2.2 Value Chain Analysis 16
4 Strategic Factors Analysis 17
4.1 SWOT Analysis 24 17
4.2 EFAS (External Factors Analysis Summary) 18
4.3 IFAS (Internal Factors Analysis Summary) 20
4.4 TOWS 22
5 Strategic strategies 24
5.1 Corporate Strategies 24
5.1.1 Vertical Growth 24
5.1.2 Consortia/Joint Ventures 25
5.2 Functional Strategies 25
5.2.1 Marketing Strategy 25
5.2.2 Financial Strategy 26
5.2.3 R&D Strategy 27
6 Strategy implementation 27
7 Monitoring & Control 29
7.1 Strategic Control 30
7.2. Using A Balanced Scorecard for Strategic Control 32
7.3. Measurement of performance 33
7.4 Criteria for Evaluation 33
8 References 34
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3
 1 Introduction and executive summary
Strategic management has become essential in any business especially with the constant changes
happening in the world. Building a strong business strategy is now an obligation, Strategic
management is simply and mainly all about the organization's clear understanding of its vision and
mission for where it wants to be in the future; and the values that will lead to its actions. The process
needs high commitment to strategic planning, with the support of business management that involves
an organization's abilities and competencies to set both the short and long-term goals. Strategic
planning also includes the planning of strategic decisions, activities and needs to help achieve these
goals.
Now, we will focus on the construction industry with one of its key players in Egyptian Market to
illustrate the objective of this study.
"The construction sector is one of the most dynamic sectors in the Egyptian economy and has been
growing rapidly since the 1980s." (“Section 4 - cufe.edu.eg”) In 2000, the Egyptian construction
market ranked 36th in the global construction market, constituting 0.4% of this market, for a value of
$12.711 billion. "The development and competitiveness of the Egyptian construction sector in the
local and international markets is affected by factors that can be classified under five main
categories: construction companies, government policies and strategies, available resources,
institutional backing and supporting industries." (“THE CONSTRUCTION SECTOR IN EGYPT
DEVELOPMENT AND COMPETITIVENESS - AmCham”) Modifications and developments within
these categories will lead to further growth and greater competitive ness for the sector.
The physical Nature of this industry is considered large, heavy, expensive with a wide range of
resources and existence everywhere. if you need to be a leader in the market.
Broadly, there are mani three sectors of construction: buildings including residential and
nonresidential, infrastructure including roads, bridges water supply, power stations,
telecommunications etc. and industries including manufacturing buildings, warehouses: data centers
and so on.

2 Orascom Construction Company

2.1 Company Overview
Orascom Construction (OC) is one of the top global engineering and construction contractors
basically focusing on infrastructure, industrial and commercial projects in the Middle East, North
Africa, the United States, and the Pacific Rim for public and private clients. Starting in 1950 and till
today, OC has grown from a family-owned local contractor to an industry leader with a world-wide
footprint. OC began within the Orascom group in 1950 as a local contractor based in Upper Egypt
and since then it has grown to become a leading global engineering and construction Company with
a reputation of excellence across its operational steps including infrastructure, industrial and high-end
commercial projects. OC targets are large, multiplex, and demanding projects that have fewer
competitors and higher margins. Focusing on turn-key Projects, OC track record ranges from water
treatment plants and power stations to luxury hotels and office buildings. OC has earned their name
for safely delivering high-quality jobs under harsh conditions on time schedule and at attractive
reasonable prices among more than six decades of industry experience. O (OC) has built a
reputation from high end quality that helped to become the contractor of choice for both public and
private sector clients for the large-scale major projects in the MENA region. The company always
follows the global standards that impact on its health and safety records in a positive way. In 2019,
OC expanded its scope to enter the industry of Operation and Maintenance (O&M) in addition to EPC
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(Engineering, procurement, and construction)

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 2.2 OC Current performance
Running Projects:
Orascom Construction Consortium to Build a New Metro System in Alexandria for EUR 1.3
billion with Colas Rail
This project, spanning 21.7 km and encompassing twenty stations to connect downtown
Alexandria with the northeastern town of Abu Qir,

Orascom Construction announces that its consortium with ENGIE (France) and Toyota
Tsusho Corporation (Japan) has signed a Memorandum of Understanding (MOU) with the
Egyptian Electricity Transmission Company (EETC) and the New & Renewable Energy
Authority (NREA) to build, own and operate (BOO) a 3 GW wind farm in Egypt.

Human Capital:
Orascom Construction over than 65K Employees worldwide, and they represent the top,
middle, lower managers and all employees inside the organization with their soft and technical
skills. As a leading company in the construction sector, casual and permanent all over the projects
and the head office premises, ranging from office boys to engineers, sales teams, accountants,
marketers, finance, HR, IT, etc...

2.3 Strategic Position

• Vision
To become a global leader in destination of development and the partner of choice for
transforming land into thriving centers of life and activities.

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 • Mission
o Creating destinations and build vibrant communities where people are inspired to
work, play and live.
o Led by a commitment to excellence, safety, and environmental standards.
o Serving our wide range customers from public and private sectors
o Offering success by a high-end quality of our destination’s delivery and long-term
value we are creating.
o Embraces social responsibility including charity, promoting volunteering, ethical labor
practices, and environmental changes. In addition to managing an environmental
impact to reduce our carbon footprint and limit waste.
o Creating a new business line in addition to their core business which is epic
activities. Capitalizing on their success in cement, and ports, they are now focusing
on developing a portfolio including infrastructure investments and operation and
maintenance (O&M).

• Company Strategy
Strengthen construction Market leadership.
o Expand market presence as an EPC contractor across our core markets in the Middle
East and Africa and strengthen capabilities across new and existing sectors. We focus
on pursuing well-funded projects where we hold a competitive edge and capitalize on
our proven financing history across various industries with high-end quality standards.
(“About - Orascom Construction”)

Leverage Strategic Partnership

o We continue to develop strategic partnerships with industry leaders and widen the
base of our clients to complement and expand our capabilities. (“About - Orascom
Construction”) Such relationships have enabled us to execute some of the most
challenging projects in our markets and practice a pipeline of projects unmatched by
others in the industry.
Grow Investments & O&M Business
o Our entrepreneurial drive has led us to the creation of new business lines alongside
our core EPC activities. Capitalizing on our success in cement, fertilizers, and ports,
we are now focused on growing a portfolio of infrastructure investments and Operation
and Maintenance (O&M) projects to create a sustainable business. Our opportunities
are wide-ranging and cover sectors such as water treatment, renewable energy, and
transportation (“About - Orascom Construction”)
Commitment to Sustainable Growth
o We passionately believe that integrating our commitment to safety, the environment
and ethical business practices into every business line is key to the ultimate success.
We are deeply engaged to our community and create a safe and healthy workplace for
all our employees.
Quality driven organization
o Engaging and Empowering Employees for Quality Excellence, as Engaged
employees are the heartbeat of creating a Quality culture. So, encourage open
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 communication, active participation, and collaboration among your team. Providing
training and development opportunities enhances your team's skills and knowledge.

Corporate Social responsibility (CSR)

o Believing in social responsibility including charity, promoting volunteering, ethical labor
practices, and environmental changes. In addition to managing an environmental
impact to reduce our carbon footprint and limit waste.

• Orascom construction Policies:

OC Compliance context is governed by a lot of codes and policies, the base of which is
the Code of Business and Conduct.
Following the code of ethics and The Code of Business Principles and Conduct, in
addition to the Legal and ethical standards that we are requiring is the main objective in
which our employees and partners should comply with , while doing their duties on
behalf of the Company
Channels of Communication
o Employees are required to have ethical behavior and encourage their colleagues to
talk to their managers or other appropriate personnel when there is a doubt about any
action in any situation. We require any incidence of misconduct, conflict of interest,
Process violation especially regarding safety and quality or illegal activity be reported
via the routes set out under the Whistleblower Policy.
• Objectives
o Excellence
o Integrity
o Quality
o Will to win.
o Teamwork

2.4 Corporate Governance Structure – Board of Directors

Orascom Construction PLC believes good governance is essential to ensuring success
and driving value for shareholders, Orascom Construction PLC’s Board of Directors
responsibilities include adopting and developing efficient corporate governance
structures and internal controls to ensure the Company’s success, Board of directors
comprises of highly qualified individuals who are experienced and skilled in their
respective fields. Each executive committee member is responsible for a business,
region, function, and/or industry segment. Not only do the board and its committees
carefully monitor progress of all business lines, companies, and services around the
world, but they ensure that company strategy, vision, mission, and core values continue
to guide all business activities and advocate for shareholders’ vision of a professional,
transparent, and ethical organization, To fulfil its responsibilities, the Board of Directors
has established four committees, the Audit Committee, Remuneration Committee,
Nomination Committee and Strategy & Sustainability Committee. The board is tasked
with constituting, assigning, coopting, and fixing the terms of service for the committee
members. It delegates certain duties to these committees as defined by their respective
terms of reference, and each committee is required to regularly report to the board. The
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 Board of Directors may opt, on occasion, to set up additional separate committees,
when the need arises.

 Audit Committee
The Audit Committee consists of four non-executive directors, The Board has determined
that all committee members have recent and relevant financial experience and shall be
regarded as financial experts, The Audit Committee is tasked with assisting the Board in
overseeing:
1. The integrity of the Company’s financial statements.
2. The Company’s compliance with legal and regulatory requirements.
3. The external auditor’s performance, qualifications, and independence.
4. The performance of the Company’s internal audit function.
5. The committee is tasked with preparing and publishing an annual committee report
and other reports required under all applicable securities laws and stock exchange
regulations.

 Remuneration Committee

The Remuneration Committee is composed of three non-executive directors, it is responsible

for assisting the board in overseeing all matters relating to director and executive officer
compensation, as well as preparing and publishing an annual committee report on the
subject matter and all other reports required under all applicable securities laws and stock
exchange regulations

 Nomination Committee
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 The Nomination Committee consists of three nonexecutive directors. It primarily assists the
board in identifying potential board members, nominating directors for the next annual
meeting of shareholders and for each board committee, as well as overseeing the evaluation
of the board and management.

 Strategy & Sustainability Committee

The Strategy & Sustainability Committee consists of six non-executive directors. It primarily
assists the board by providing an advisory role with a focus on the Company’s long-term
strategic plans and matters related to sustainability, including, but not limited to Health, Safety,
and the Environment (“HSE”), The role and responsibilities of the Strategy & Sustainability
Committee are stated in written terms of reference and include the following:

1. Reviewing and providing guidance to management with respect to the Company’s

long‐term strategic plans to reflect changes in market or business conditions and
identify strategic possibilities for further development.
2. Evaluating diversification opportunities into new markets and construction sectors.
3. Examining strategic investments, acquisition and disposals.
4. Monitoring and periodically discussing the current and emerging topics,
technologies and trends relating to sustainability, including new or emerging
opportunities and projects that may affect the business, operations, performance or
public image of the Company or are otherwise pertinent to the Company and its’
stakeholders.
5. Reviewing periodically and evaluating the sustainability performance metrics and
KPIs with a long-term view towards achieving announced Company targets;
6. Reviewing and monitoring the Company’s HSE performance statistics.

3 Environment Scanning

3.1 External Factors Scanning: 3.1.1 Remote environment

• Using PESTLE analysis as a tool to scan the external factors affecting the
construction industry as general and OC specifically

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 1. Political Factors
 Using PESTLE analysis
Governmental policies
 Political factors in a PESTLE analysis are the factors that are affected by a
country’s political scenario and government policies. In This section we will
summarize how various political factors affect the construction industry.
 Frequent changes in the government and it polices really affected the stability of
construction sectors negatively. (T)
 OC at that time as one of the leaders had been affected as well and its investment
in this sector had been minimized till having a clear vision (T)
 The expansion strategy of the government starting from building the new capital
passing by the revolution of power stations investment made a refreshment to the
whole sector (O)
 The complexity of the mega projects gave the edge to OC to gain the largest share
in this market, hence it was one of the icons of such special projects (O)
 The government has also continued to promote the public-private partnership
(PPP) model. (O)
 The direction of the government to assign some special project to a third party as a
subsidiary to the government, led dome of the mega companies to limit its
investment or to be transformed to sub-contractors (T)
 Five-year plan for providing 1 million subsided homes to low –income citizens, was
implemented by the government in response to the housing gap opened a new
market for the big companies as OC (O)
 The government policy to inject heavy spending on new projects as bridges,
railway & other transportation infrastructure for example, in November 2020, the
government allocated EGP90 billion (US$5.2 billion) for the development of
infrastructure of fourth-generation cities in the country. (O)
 Political and financial incentives are crucial to ensure the recovery and growth of
the construction sector. (O)
 The army has been interfering in heavy way an all construction works and projects
which impose current situation of undiversified market clients plus they impose
difficult payments terms. (T)
 Negative impact on market due to war or Russia/Ukraine war results in material
shortage (energy, Oil and Gas supplies, Construction material supplies, food
industries supplies…etc.)
 Tax policies: New value-added tax (VAT) law & its increase from 13% to 14% have
caused increasing in the cost of the construction industry. (T)

2. Economic Factors
Economic factors are also significant external factors that impact the operations of any
business or industry. This section of the PESTLE analysis will highlight the economic
factors that affect the construction industry.
 After the devaluation of currency in 2016, a lot of contractors put their
business on hold especially who was depending on some imported parts. (T)
 Governmental compensations were given to contractors under the current
contracts at that time to support them (O)
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  During COVID-19 Ministry of Housing, Utilities, and Urban Communities has
promised to pay EGP 3.8 bn in arrears to contractors to help pay salaries
and expedite construction, specifically in national projects. (O)
 Investment of new projects as the New Administrative Capital to the Suez
Canal Economic Development Zone led to boosts the economic growth,
improving Egypt economic competitiveness, which encourage most of
market leaders to invest in residential communities in this new area (O)
 Egypt construction industry expanded by 3% in beginning of 2020 - although
positive, it was a marked slowdown compared to recent years, reflecting the
disruption caused by the COVID-19 pandemic. (T)
 Funding arrangements have already proven a weak point in mega projects
as Plans for the New Administrative Capital outside of Cairo have shifted
several times as a result of complications of funding and pricing. (T)
 Tax interventions facilitating transactions by increasing liquidity in the real
estate market and extending the robustness of the banking system that helps
boosting incentives for new investment in buildings. (O)
 Increasing scarcity of raw materials and natural resources (water, energy)
Effective use of natural resources in the construction industry. (T)

3.Social Factors
 Dynamics of population: High concentration of the population poses particular
challenges; this tendency has also led to a sharp rise in house prices. (O)
 Labor skills: The shortage of skilled workers is said to be the primary and
growing problem of the construction industry, and it will even affect sector
competitiveness. (T)
 Educational systems: There are different public & private education systems
that adopt the construction labor skills. (O)
 Population demographics: Growing population has pushed the growth of
construction sectors especially the construction of new cities and residential
areas. (O)
 Under the age of 25 represents more than 50 % of Egyptian population, these
new generations represent the buying force for the next decade. So, the type &
place of the property demanded in their new communities are changing. (O)
 Distribution of wealth: The private investment in the residential segment is
more concerned with a relatively small segment that represent about 15 % of
population that can provide them with high profit margin. (T)
4. Technological Factors:
 Software Solution: -
Construction software solutions that help streamline of business processes and
improve productivity, such as ERP software that recording the transactions,
changes and updates of documents, schedules, and other management tools to be
made in real time, facilitating better communication and collaboration.
 Building Information Management (BIM)
- which is called 3D rendering software programs , contains most of these
solutions and more to provide the ability to create a 3D building plan and
combine it with a construction schedule.
- The investment of large companies as OC in the new high-tech machines,
which are specialized for particular fields, led OC to hold its position within the
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 mega projects and new skyscrapers hence it had the needed tools and
technology.
The tendency to cope with the new technologies of smart homes, led the
companies to create more jobs and internal functions to meet the customers’
needs within this field.

- AI& Machine Learning: Construction firms can turn the huge number of data
that have been collected over the years on projects to predict future outcomes
on projects and gain a competitive advantage when estimating and bidding on
construction projects, such sensors, Robots, Autonomous drones, Autonomous
drones and rovers.
 Augmented reality (AR)
is another technology that improving safety on the construction sites. By providing
the detailed safety plan to be trained on heavy equipment using actual equipment
on real sites with augmented hazards. (O)

5.Legal Factors
 The government decided to exclude the new urban communities from the normal
procedures of the normal cities especially with needed permits and regulations, as
limitation of heights, which led to the horizontal expansion of residential areas. (O)
 The government announced new building regulations after the end of suspension
period. Contractors waited to see regulations before being committed to new
investments. (T)
 The changes done by the government to hood any new buildings in main cities led to
open a new opportunity in the new urban, and raise the prices in the main cities as
well.
 New Urban Communities Authority (NUCA) solves any issues that may affect the
progress of investments in new cities. (O)
 Tough penalties were imposed on those who violate the building codes which eliminate
a lot of small companies from the market, hence they don’t have the skilled resources
and abilities to meet the new regulations. (T)

6. Ecological and environmental factors

 To meet the international standards, OC enforced its teams to strictly follow the
procedures that keep the environmental clean upon the governmental regulations
 Creating Onsi Sawirs scholarship program in 2000 as part of the company’s
commitment to promoting excellence and achievement.
 Orascom Construction responded promptly to a request by the Professors of
Plastic Surgery, Faculty of Medicine of Ain-Shams University, through offering a
generous donation and purchasing a new Pulsed Dye Laser machine for the
department.
 Orascom Construction has made a significant donation whilst being the main
contractor for building Ahl Masr Hospital, a specialized burn hospital that serves
the unnoticed massive numbers of burn injuries.

7. Environmental factors
 Construction sector contributes to 23% of air pollution, 50% of the climatic change,

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 40% of drinking water pollution, and 50% of landfill wastes, also it accounts for 40%
of worldwide energy usage, (T)
 The building materials, such as cement, aluminum, and steel, are directly responsible for
“large quantities of CO2 emissions” during manufacturing (T)
 According to the EPA rules, there are certain discharges that are prohibited using to
protect the workers and the surrounding environment in which OC is following the
international regulations to keep HSE standards as high as much. (O)
 Go Green that uses environmentally friendly materials during the construction
process that can save 250 metric tons of CO2 emissions annually. (O)
 The government has made the development of a sustainable energy mix a priority;
example energy projects include the construction of renewable energy power plants
through partnerships(O)
 Environmental offsets: It is a conservation action or amount of money that a
developer or a company is asked to contribute to counterbalance the environmental
impacts of their projects. (O)

3.1.2 Industry Analysis: (Porter's Five 5 Forces Model of Competition)

1. Threat of new entrants

It is difficult to enter the construction industry in the category and level of Orascom company
which are working within huge investment and expertise needed plus Government
restrictions need to overcome to compete in this level , So Orascom will not face a risk of
new competitors, so that Orascom have a little competitive advantage that can make it
gather benefits for a longer period, Also, under difficult entry conditions, Orascom will face a
constant set of competitors for the longest possible time.
So, Threat of new entrants is Weak
2. Rivalry among existing competitors
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 There are many participants in the Construction Industry in Egypt and their market share
represents the competitiveness of the construction industry in Egypt. But There are some
companies that are directly competing Orascom Construction Like Arab Contractors,
Talaat Moustafa Group Holding (TMGH), Emaar Misr for Development (EMFD), and Amer
Group (AMER), Lack of product differentiation tends to add intensity of competition, As
The competition among the industry is strong between top companies through competitive
tenders, Each company has to compete by offering the lowest price for provided services
to secure clients , and usually the competing companies try to expand its activities to
maintain its position and stand against competitors using the high technology.
So, Rivalry among existing competitors is Strong.
3. Bargaining power of suppliers.
Due to the large industry of Orascom Construction PLC holds a portfolio of construction
materials and investment companies that complement the Group’s core activities,
including manufacturers of fabricated steel products, glass curtain walling, paints and
concrete pipes as well as an industrial free zone and two facility management companies
like National Steel Fabrication, Aluminum (ALICO), paints & chemical (UPC), Pipes (NPC),
and SCIB Chemical (SCIB), plus they cannot bargain Orascom because it has a good
purchasing power and many suppliers, For example, in Steel there are Ezz Steel, Egyptian
Steel and Suez Steel. Also, in PVC pipes there are Misr ElHegaz Group, Al Amal company
and NEISCO, That is to say that Orascom has the power to have all needed resources
easily The supplier power in constructions industry considered weak.

4. Bargaining power of Buyers.

The type of customers for Orascom in private sector is the upper class, so they always
need high quality with good price, because of the great competition in quality and prices
between Orascom and its competitors the customers may have to bargaining or negotiate
to have additional services or discounts, also in public construction industry, the consumer
is the client who considered has strong power because he chooses the company through
bid and always goes to the lowest possible price. In addition, there are many construction
companies compared to the number of clients.
Nowadays the high level of technology and information sharing allow the consumer to
have a high quality of information for decision making and choose the best choice.

So, Bargaining power of Buyers Strong

5. Threat of Substitute Products
According to the great competition between Orascom and its competitors which affect the
profitability of Orascom because it can take one of two forms, to offer a product with the
same quality of competitors but with a lower price or a product of the same price but with
better quality.
So, Threat of Substitute Products is Strong
6. Relative power of other Stakeholders.
o Owners & buyers: bargaining power is strong because always there’s great competition
and the buyer or owner have multiple choices to decide.
o Governments: bargaining power is strong as we have to follow laws and rules.
o Management: bargaining power is strong only when leader ship is unified with little

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 conflicts.
o Employees: bargaining power is strong only when leader ship is unified or existing of key
employee.
o Creditors: bargaining power is strong the company always in a need to follow creditor rules
and instructions to get the needed funds for its investments and have to ensure stability in
paying debts with its interest rates.

3.2 Internal Analysis (Organizational Analysis):

Orascom organizational structure is a mixture between functional and matrix organizational
structure, Decision making and taking is centralized as usually identified in family
business-based organization, and also as usual this leads to number of issues such as,
time consuming decision-making process, The hierarchy of the organization is respected
even in the most severe and urgent situations where immediate actions should be taken
Orascom company OC organizational structure chart is a hierarchal with many levels
(Grades from 1 up to 17), the reporting line goes all the way from the lower levels up until it
reaches the responsible high tier of bosses who are responsible for the decision-making

process.
-We will use RBV and VCA models to analysis the key internal Factors that achieve the company
better performance as per each theory parameters:

3.2.1 Resource Based View

In the Resource Based View theory, resources and capabilities are given the major role in
helping companies to achieve higher organizational performance by analyzing and
identifying a firm strategic advantage based on examining its different combination of next
factors:
1- Tangible Assets:
OC consider the capital and resources are the main asset for the company
These are the tangible assets of the organization, include property, plant and equipment,
The headquarter building is a huge building with a view on the Nile, the biggest equipment
fleet in all of the construction companies in Egypt, warehouses which are spread around the
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 country and Construction material subsidiary companies that provide the construction sector
with a lot of the necessary raw materials for the operations, As a leading company in the
construction sector, there are more than 65,000.
2- Intangible Assets:
-Orascom has a proven track record spanning decades of experience of successful delivery
of challenging projects across various sectors.
-This includes resources such as brand names and the acquired knowledge and ‘know-how’
of the organization, the brand name is well- known all over the Middle East as one of the
leading companies in the construction sector.
3- Capabilities:

- Orascom has competitive capabilities in:

- Proven financial capabilities to secure and arrange debt for complex industrial and
infrastructure projects worldwide, having historically raised ~USD 18.5 billion of financing
and having strong relationships with European, UAE, US and Egyptian lenders
- Ability to work in different geographic areas and in different work sectors, OC has wide
range of Capabilities Across Various Geographies and work sectors as Orascom
Company operates under three brands Orascom Construction, Weitz , Contrack Watts
and owns 50% of BESIX Group in all over the world and in various work areas like
(infrastructure& Heavy industrial projects & Marine & high-end commercial projects& Co-
developer and co-owner of Egypt’s first PPP project (Orasqualia) and the largest
renewable energy IPP project in Egypt (262.5 MW BOO wind farm) & Diverse O&M
contracts in water, transportation and facilities management, and equipment services
company subsidiary).

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3.2.2 Orascom Value Chain Analysis
General Management (Management committee), Planning Strategy for next period (target Objectives).
Finance Management, managing funds resource, Receivable, Payable, cost control and monitor all function through ERP (SAP)
AaP

Human Recourse Management, Recruiting Qualified Employees, improving and developing Orascom Competency Matrix for all
Depts. (training, knowledge), arranging with Training and learning programs to prepare new generation of skilled well-trained
workers)

IT Department, Orascom implement ERP(SAP), I.T dept. Securing smooth and stainable flow of data through sys for each
company unit, technical departments and R&D dept. monitor & follow updated tech in each stage of Construction Industry to keep
updated with Market
Procurements dept. Securing follow for RM, Supplies and Equipment form its own companies or from reliable supplier to
guarantee stable follow of needed RM via long term contract for main items, long term supply contract to cover annual needs
and to protect from price fluctuations.
Profit
Inbound Logistics: Operations Outbound Logistics: Market and Sales Margin
- incoming Raw Material, This includes all the Customer services
Supplies and equipment manufacturers and -Hand over the Project - Forecast expected and Quality Support
brought from its own to the Owner. projects and annual
installation process that are
company and from local - Or Handover it to for sales for Local for B2B - Provide customer
Market or Imported used throughout the project
Market and sales. or B2C customers. after sale service of
(dealing with authorities execution:
- Preparing Marketing O&M for warranty
Customs, governmental - Planning periods.
Campaign/researches (in
dept. - Material supply. -
internal & external Markets) Follow with B2B &
- Construction and B2C Level of
Promoting and Positioning
- These are the materials installation process. customer
new Customers.
- Test and commission.
that will be used within - Issue Sales Contract, satisfaction
- Closing and finish project
the construction project follow up delivery plans
for customers
C.S Marketing &
Outbound Operations Inbound
Sales
Logistic Logistic

Primary Activities
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4. Strategic Factors Analysis
4.1 SWOT analysis:

SWOT ANALYSIS

STRENGTHS
1- well diversified commercial geographic
presence.
2- Well diversified business presence in
fertilizers, Materials and construction industry
diversifies the business and reduces risk
3- Strong financial position good growth in
EBITDA and net income growth over the years
4- strong order backlog that shows financial
stability.
5- Highly skilled calibers & Huge fleet of
equipment, plants and warehouses
WEAKNESSES
1- High overheads cost which affects the pricing
strategy
2- Higher debt and interest expense - will
negatively impact the profitability and pricing
power of the company
3- Litigations tarnish company’s image – a
number of litigations have been filed against the
company’s fertilizer and construction businesses,
tarnishing the image of the company
4- performing subcontractor.
5- Workers' loyalty as workers shift to other
companies looking for higher salaries.

OPPORTUNITIES
THREATS
1- growing construction in the Asian region – the
revenue contribution from Asia and Oceania
region is substantial.
2- Energy projects using renewable energy power 1- unfavorable government policies can cause
plants. operational inefficiency.
3- The government policy to inject heavy spending 2- Economic conditions fluctuations in Egypt.
on new projects as bridges as bridges, railway 3- Tax policies that increase the cost of the
& other transportation infrastructure, The Water construction industry.
treatment & circular economy and& waste 4- Emergence of new local and foreign
management. competitors with the ability to compete
4- Public/private partnership efficiently.
5- Expansion in new markets, Expansion into
5- Army intervention in the industry.
emerging economies can propel the company
further
6- Negative Impact on market as result of the
6- New technology that helps in improving Russia/Ukraine war.
productivity. 7- Sacristy of natural resources
7- MENA Countries expansion in industrial,
housing and Infrastructure projects.
8- strong relationships with international, regional
and Egyptian financial institutions to provide
needed funding.
9- Learning and transferring expertise from foreign
companies.
10- Brand loyalty
11- Population demographic.

19
 4.2 EFAS (External Factors Analysis Summary)
External Factors Relative Rating Weighted Comments
Weight score

Opportunity
Energy projects using 0.15 4.0 0.60 • Completed over 28,000 MW of power
renewable energy power generation projects in MENA (Egypt, Algeria
plants. and Iraq)
• Over 12,500 MW of power generation capacity
in Egypt since 2016 including the largest plants
worldwide
• Renewable energy projects include
hydropower in Burundi, and solar and wind in
Egypt
• Currently connecting the national power grids
of Egypt and Saudi Arabia
Expansion in new markets, 0.10 4.0 0.40 • Repeat contractor on data centers in USA and
Growing construction Egypt
industry • Over 12 mtpa of nitrogen fertilizer capacity in
Egypt, Algeria and USA including the largest
nitrogen fertilizer
plant in USA in nearly 30 years, and repeat
contractor for agro/food players in the US
• Over 40 mtpa of cement production capacity
around the world
• 8 petrochemical projects (ex. fertilizer) in the
Middle East and the largest methanol plant in
USA (“Corporate Presentation May 2022”(
Public/private partnership 0.05 4.0 0.20 Orascom Construction and Spanish
wastewater management company Aqualia
established Orasqualia

20
The government policy to
inject heavy spending on
new projects as bridges as
bridges, railway & other
transportation infrastructure
& Water treatment leading
the development of Egypt’s
water sector across all
segments including
desalination, wastewater
and water infrastructure.
New technology that helps
in improving productivity
strong relationships with
international, regional and
Egyptian financial
institutions to provide
needed funding.
Learning and transferring
expertise from foreign
companies.
Brand loyalty
Threats
Sacristy of natural
resources
unfavorable government
policies can cause operational
inefficiency.
Economic conditions
fluctuations in Egypt
0.15 4.0 0.60 - Lafarge Egypt and Orascom Telecom Media
and Technology Holding (OTMT) announced
that they have signed a memorandum of
understanding (MoU) to develop a waste
management framework of municipal and
agricultural waste.
One of the largest water EPC contractors in the
region, leading the dev
-elopment of Egypt’s water sector
across all segments including desalination,
wastewater and water infrastructure
• Projects include the largest water treatment
plant in the world and Egypt’s first PPP project
(“Corporate Presentation May 2022”
0.025 4.0 0.10 R&D department is always
pursuing new technologies.
0.10 4.0 0.40 Finance team previously secured and arranged
debt for complex industrial and infrastructure
projects worldwide across cement,
fertilizer, power and infrastructure sectors,
having historically raised ~USD 18.5 billion of
financing and having strong
relationships with European, UAE, US and
Egyptian lenders;
‒ Over USD 18.5 billion debt raised over past
15 years;
‒ USD 5.8 billion debt raised as ring-fenced
project finance; and
‒ USD 2.8 billion of access to non-bank liquidity
through US, European & Egyptian debt capital
markets (“Corporate Presentation March 2022”(
.025 4.0 0.10 Joined mega projects a lot of Joint Ventures
.025 4.0 0.10 Leading EPC Track Record Across Several
Industries and Geographies
0.025 3 0.075 Increasing scarcity of raw materials and natural
resources (water, energy) Effective use of
natural resources in the construction industry.
.025 3 0.075 The government decision of suspension of
constructions for six months.
.05 3 0.15 Always trying to cut down costs and maximize
revenue.
21
Tax policies that increase the 0.025 3.0 0.075 Tax policies that increase the cost of the
cost of the construction industry. construction industry.
Emergence of new local and 0.05 3.0 0.15 Having the cost advantage over them. However,
foreign competitors with the they possess the know-how.
ability to compete efficiently.
Army intervention in the 0.15 3.0 0.45 As one of the biggest companies, very few can
industry. tolerate the payment terms of the army.
Negative Impact on market as 0.5 3 0.15 Slowing down of construction market in 2022
result of the Russia/Ukraine due to lack of material as result of
war. Russia/Ukraine war.
Total scores 1 3.625
 Conclusion: means that the Organization has competitive position in market and has high
capabilities to catch and use Opportunities and overcome threats.

4.3 IFAS (Internal Factors Analysis Summary)

External Factors Relative rating Weighted Comments
Weight score
Strengths
well diversified commercial 0.10 4.0 0.40 Orascom Company exists in 25+
geographic presence. countries in 5 continents with a key focus
on Europe, MENA, Australia and select
African markets
Well diversified business 0.15 4.0 0.60 Orascom Construction PLC operates under
presence in fertilizers, three brands and owns 50% of BESIX
Materials and construction Group, plus other supportive subsidiaries
industryfinancial
Strong diversifies the
position 0.10 4.0 and investments.
0.40 Wastewater treatment PPP for the firm and
and a sufficient more tasks expected in pipeline.
working capital

22
Strong order backlog that
shows financial stability.
Highly skilled calibers &
Huge fleet of equipment,
plants and warehouses
Weakness
High overheads cost which
affects the pricing strategy
higher debt and interest
expense will negatively
affect the profitability of
the company.
performing subcontractor.
Many Litigations tarnish
company’s image.
Workers' loyalty as
workers shift to other
companies looking for
higher salaries.
Total Score
 Conclusion: Total score above 2.50 means that the Organization has strong internal environment
0.20 4.0 0.80 ▪ Consolidated
▪ Consolidated backlog (excluding BESIX)
increased 2.3% y-o-y to USD 5.5 billion in
Q1
2022
▪ Consolidated new awards decreased 7.3%
y-o-y to USD 617.5 million in Q1 2022
MEA
▪ New awards of USD 326.2 million in Q1
2022 (“Corporate Presentation March 2022”(
▪ New awards across railway,
roads/highways,
and water sectors
USA
▪ New awards of USD 291.3 billion in Q1
2022
▪ New awards in Q1 2022 represent an
increase of 3.0x y-o-y
▪ New projects mostly across commercial,
light
industrial and data center sectors(“Corporate
Presentation March 2022”(
0.10 4 0.40 In Orascom there are more than 65,000
employees
0.05 1 0.05 Company size affects the pricing strategy
0.10 1 0.10 Higher debt and interest expense cuts
from company profitability.
0.025 2 0.05 Subcontractors may cause bad quality work
and may not adhere to work delivery dates.
0.025 2 0.05 a number of litigations have been filed
against the company’s fertilizer and
construction businesses, tarnishing the
image of the company
0.05 2 0.10 Noncompetitive compensation for
employees forces them to look for other
opportunities.
2.95
23
 and ability to use and develop existing strength points and overcome weakness points.

4.4 TWOS Matrix:

Strengths and Opportunities (SO) Strategies:
Using internal strengths to take advantage of external opportunities.
Strengths and Threats (ST) Strategies:
Using internal strengths to mitigate or minimize external threats.
Weaknesses and Opportunities (WO) Strategies:
Taking advantage of external opportunities to offset or mitigate internal weaknesses.
Weaknesses and Threats (WT) Strategies:
Strategies and tactics that minimize both internal weaknesses and external threats.

Weaknesses
Strengths
W1- High overheads cost which affects the pricing
strategy
S1- well diversified commercial geographic presence.
W2- Higher debt and interest expense - will negatively
S2- Well diversified business presence in fertilizers,
impact the profitability and pricing power of the
Materials and construction industry diversifies the
company
business and reduces risk.
W3- Litigations tarnish company’s image – a number
S3- Strong financial position good growth in EBITDA
of litigations have been filed against the company’s
and net income growth over the years .
fertilizer and construction businesses, tarnishing the
S4- strong order backlog that shows financial stability. 24
image of the company
S5- Highly skilled calibers & Huge fleet of equipment, W4- performing subcontractor.
plants and warehouses .
W5- Workers' loyalty as workers shift to other
companies looking for higher salaries.

Strengths
S1- well diversified commercial geographic
presence.
S2- Well diversified business presence in
fertilizers, Materials and construction industry
diversifies the business and reduces risk.
S3- Strong financial position good growth in
EBITDA and net income growth over the years
. businesses, tarnishing the image of the
S4- strong order backlog that shows financial
stability.
S5- Highly skilled calibers & Huge fleet of
equipment, plants and warehouses .
Weaknesses
W1- High overheads cost which affects the
pricing strategy
W2- Higher debt and interest expense - will
negatively impact the profitability and pricing
power of the company
W3- Litigations tarnish company’s image – a
number of litigations have been filed against
the company’s fertilizer and construction
company
W4- performing subcontractor.
W5- Workers' loyalty as workers shift to other
companies looking for higher salaries.

25
Threats
T1. unfavorable government policies can cause operational inefficiency.
T2. Economic conditions fluctuations in Egypt and other countries.
BCG

5. Strategic strategies

26
 Corporate Strategy

Functional Strategy

Orascom's Levels of Strategy

5.1 Corporate Strategies:

Based on the Orascom construction internal and external analysis we suggest focusing on
corporate to have clear path towards achieving company long-term objectives, managing
risks, staying competitive, and adapting to the changing landscape of the construction
industry. Also, provides a roadmap for sustainable growth that leading to success.

5.1.1 Vertical Growth

After do a Market Research and Analysis to Understand the current market conditions,
trends, and chances in the construction assiduity. Identify implicit areas within the
value chain where Orascom Construction can expand vertically, such as design,
engineering, manufacturing, or real estate development.
Strategic Partnerships and Alliances Form strategic hookups with companies that
round OC services or fill gaps in OC value chain. Collaborating with engineers,
suppliers, or real estate inventors, for illustration, can help OC to expand vertically.
Explore mergers and accessions to acquire companies that have moxie in areas that
OC want to expand into.
Diversification of Services Consider diversifying pasture of construction services, alike
as offering strategy and architectural services alongside your construction services.
This can give OC further control over systems and increase the OC value proposition.
Develop moxie in new areas, similar as sustainable construction, smart structure
technology, or modular construction.
Innovation and Technology Embrace innovative construction styles, accoutrements,
and technologies to gain a competitive advantage and enhance your perpendicular
growth strategy. Invest in exploration and development to produce personal
technologies or construction processes.

27
 Talent Development Attract and retain professed professionals with moxie in the areas
that OC wants to expand into. This may bear recruiting engineers, masterminds, or
specialists in new construction styles. give training and development programs to
upskill OC employees.

Geographic Expansion Consider expanding OC operations to new geographic

requests, either regionally or internationally, where there's demand for OC services.
acclimatize your strategies to meet the specific requirements and regulations of the
new requests.

5.1.2 Consortia/Joint Ventures:

Orascom construction can grow horizontally through internal development or externally
through accessions or strategic alliances with other enterprises in the construction
assiduity. They can expansion into new regions, locales, metropolises, or countries. And
invest in client accession Organizations may have a capital investment or an internal
budget allocation to check this design through.

5.2. Functional strategy

These strategies are designed to align with the broader organizational goals and
objectives, ensuring that each functional area contributes to the achievement of the
OC strategic vision. We will provide details about functional strategy, its importance,
and how it is implemented within an organization.

5.2.1 Marketing Strategy

 Market development:
 Based on all the previous analysis we identify that OC potential new markets or
regions has a growth opportunity like extend in Europe and Asia.
 Based on demographic, economic, and construction industry data. OC can cover
the demand for construction services in Europe, Asia, and Africa.
 Market Segmentation: Dividing the new market into segments based on relevant
characteristics (e.g., demographics, behaviour, geography).
 Market Entry: Deciding on the method of entry, which may include exporting, joint
ventures, partnerships, or establishing a physical presence.

 Market penetration:
 Product or Service Adaptation: Modifying or customizing existing products or
services to better meet the needs and preferences of the new market.
 Pricing Strategy: Determining pricing that is competitive and attractive to the new
target market.
 Distribution Channels: Selecting appropriate distribution channels to reach the
new customers effectively.
 Marketing and Promotion: Developing marketing campaigns and communication
strategies tailored to the new market segment.

 Product development

While Orascom Construction (OC) is primarily a construction and engineering company,

product development in its context would relate to diversifying or enhancing its service
offerings within the construction and infrastructure sector. Here's how product

28
 development could apply to OC:

1. Diversification of Construction Services:

OC can expand its range of construction services to include new types of projects or
specialized areas, such as green building, sustainable construction, or innovative
construction methods. For example, it could start offering services related to renewable
energy projects like wind and solar farms.

2. Innovative Technologies and Materials:

Embracing new construction technologies and materials can be a form of product
development. OC can explore the use of cutting-edge building materials, digital
construction methods, or modular construction techniques to offer clients more
advanced and efficient solutions.

3. Customized Solutions:
OC can develop tailored solutions for specific client needs. This might involve providing
design-build services or customizing construction processes to meet unique project
requirements.

4. Value-Added Services:
OC can enhance its core construction services by offering additional value-added
services, such as project management, consulting, maintenance, or post-construction
services. This can make OC a more comprehensive and attractive construction partner.

 Penetration Pricing:

1. New Market Entry:

When entering a new geographic market or targeting a new customer segment, OC
could use penetration pricing to quickly establish a presence. This involves offering its
construction services at a lower cost than existing competitors to attract initial clients
and gain a foothold in the market.
2. Competitive Advantage:
Penetration pricing can give OC a competitive edge in a market where pricing is a key
factor in winning contracts. By offering lower prices, OC may attract cost-conscious
clients and stand out from competitors.
3. Securing Long-Term Contracts:
OC can use penetration pricing as a strategy to secure long-term contracts with the
expectation of gradually increasing prices over the contract duration. This can help OC
establish strong, ongoing relationships with clients.

5.2.2 Financial Strategy

 Dividends:
 OC balance providing consistent dividends to shareholders with retaining earnings
for reinvestment in the business. This balance ensures that shareholders receive a
reasonable return while the company has sufficient capital for growth and
investment.
 OC monitor and communicate the dividend yield to attract income-oriented investors.
A competitive dividend yield can make the company's stock more attractive to
investors seeking regular income.

29
  OC establish a clear dividend policy that outlines how profits are distributed to
shareholders. This policy considers the company's financial health, cash flow, and
growth opportunities. OC determine the percentage of profits to be distributed as
dividends and the frequency of dividend payments (e.g., quarterly, annually)
 Stock Price:
 OC's focus on improving its financial performance, which can have a positive impact
on its stock price. Consistent revenue growth, profitability, and cost management
can contribute to a strong stock performance.
 Consider share buyback programs as a means to support the stock price. These
programs involve repurchasing OC's own shares from the market, reducing the
number of outstanding shares and potentially boosting the stock's value.

5.2.3 R&D Strategy

 R&D will help to both deliver and shape the corporate’s strategy, so that it develops
discerned immolations for the company’s precedence requests and reveals strategic
options, pressing promising ways to budge the business through new platforms and
disruptive improvements. Artificial intelligence can be used at the discovery phase to
identify arising request requirements or new uses of being technology and we can use
university inquiries or private sector research to achieve the below tactics:
 Re-invest in new styles and technologies using the strong R&D department
 Reduce costs to contend efficiently with other original companies and avoid working
only with the Army.
 Strengthening the exploration and development department to always seek new styles
and technologies, mortal coffers to hire educated contrivers to subsidize on the
increased profit and take systems as EPC.

6. Strategy implementation:
Once strategies are agreed on, the coming step is the perpetration phase. Top
management is important to the effective perpetration of strategic change since during
this stage of the strategy, top operation will concentrate on effectiveness to make sure
that we ’re doing effects right with minimum coffers and concentrate on the functional
process, internal processes, hence, the association performance.

Strategic implementation, or as some might call it strategic execution, is the phase where
the medication and planning stop to let the action begin. Stylish plans wo does not
compensate you for chaotic perpetration. Everyone within the association should bear in
mind his or her liabilities, assignments, and authority. operation should give fresh hand
training to fulfill plan objects during this stage, as well. It should also allocate coffers,
including backing. Success during this stage depends upon workers being given the
tools required to apply the plan and being motivated to insure it works.

Hence OC is intended to proceed in building a new Commercial and Residential compound

in Alegria the same as Z Park in Egypt, we are here stating the Marketing Strategy
implementation Plan for this New Project.

30
Marketing
Strategy
Implementation STATUS
COLOUR
Plan LEGEND &
TOGGLE

MARKETING PLAN LISTS

Marketing plan lists Not started Delayed Complete Custom 1
ON OFF ON OFF
Anticipate Anticipate
Action Item Status Owner d Start d End Comments
Date Date
Strategy 30-Sep-
Setting Company Goals Complete 1-Aug-23
Team 23
In Marketing 30-Nov-
Target Segment 1-Oct-23
progress Team 23
Study Market and In Marketing 30-Nov-
1-Oct-23
Consumers progress Team 23
Market Survey for Raw In Procurement 15-Nov-
1-Oct-23
Material progress Team 23
Researches the local In Marketing 15-Nov-
1-Oct-23
competitors progress Team 23
workforce Survey Not Administratio 30-Nov- 30-Dec-
(Local / Expats) started n Team 23 23
Equipment / Machines Logistic Delayed due to
10-15-23 12-30-23
Availability Delayed Team VISA
Porter's Five Force In Strategy 15-Nov-
1-Oct-23
Analysis progress Team 23
Not 15-Feb-
SWOT Analysis PMO Team 15-Jan-24
started 24
Position the company Not Marketing 10-Mar-
20-Feb-24
in the Market started Team 24
Preparing Project Not Finance
15-Mar-24 15-Apr-24
Budget started Team
Marketing campaign
Not Marketing
(Ads, social media, Etc 17-Apr-24 Q1-2025
started Team
…)
Not
units Leasing Process Sales Team 1-May-24 Q2-2026
started

Quality control, In Governance 1-Oct-23 Q2-2026 ensuring That

31
 Completed Activities
progress reports progress Team are matching
Mission & Vision

7. Monitoring & Control

The primary rationale for business strategy assessment is the possibility of strategy failure
during implementation, which calls for the need for prompt remedial action in order to
support the comprehensive evaluation report.
Such assessment reports for the incentives also pique the interest of decision-makers in
case the strategic Plans are effective.
As part of the strategy review process, our strategic plan is analyzed, and it is determined
how.
A fundamental problem facing managers today is the way to effectively control employees in
light of recent organizational demands for greater flexibility, innovation, creativity, and
initiative from employees.

The evaluation and control process established in Orascom Services company is based on figure
(10) where first the item in the strategy to be measured in determined, then a benchmark is set to
evaluate the performance against, after the performance is measured if it matches the standards
then the company moves along to the next item, if the performance does don’t match the standards,
them corrective actions has to be taken and, the item is measured again to make sure it matches
the performance this time. Which is why it is been established that using the balanced scorecard
tool will be the perfect way to measure and evaluate the overall as well as the specific areas of the
strategy in accordance with the company, also how internal resources can be used efficiently and
effectively to help reach external results. “The Balanced Scorecard is a system connects the dots
between big picture strategy elements such as mission (our purpose), vision (what we aspire for),
core values (what we believe in), strategic focus areas (themes, results and/or goals) and the more
operational elements such as objectives (continuous improvement activities), measures (or key
performance indicators, or KPIs, which track strategic performance), targets (our desired level of
performance), and initiatives (projects that help you reach your targets)
(Strategy Management Group, 1998-2017).

32
Asset Utilization Rate Of sales Growth Profitability Total Cost Leadership Quick Ratio Return On
Capital Employment breakeven point Increased revenue and operating profit Ratio operating profit
to income Increased financial discipline

Strategy evaluation includes 3 basic activities:

• Analyzing the fundamentals of a business's approach.
• Analyzing and contrasting anticipated and actual outcomes.
• Taking remedial measures to ensure that performance complies with plans.

Strategy Evaluation is becoming increasingly difficult today because of the

following reasons:
• A sharp rise in the complexity of the surroundings.
• The growing challenge of making an accurate longer-term prediction.
• The growing quantity of variables.
• The speed at which even the most basic designs become outdated.
• The increase in the quantity of national and international events that have an impact on
organizations.
• The shorter amount of time that planning will take to complete with any degree of assurance.

7.1 Strategic Control

Strategic control is a term used in management and business strategy. It refers to the process
by which an organization tracks and monitors its strategy as it is being implemented, detecting
any problems or potential issues as early as possible and taking corrective action.
Strategic control involves several steps, including:
1. Setting strategic objectives: These are the goals the organization wants to achieve
through its strategy. These objectives should be SMART – Specific, Measurable,
Achievable, Relevant, and Time-bound.
2. Implementing the strategy: Once the objectives are set, the organization implements its
strategy.
3. Monitoring performance: The organization tracks its progress toward its strategic
objectives. This may involve collecting data on key performance indicators (KPIs), such
as sales, customer satisfaction, market share, etc.
4. Comparing actual performance with objectives: The organization assesses whether it
is on track to achieve its strategic objectives. The organization must understand why
these exist if discrepancies exist between the actual performance and the objectives.
5. Taking corrective action: If the organization is not on track to achieve its objectives, it
may need to adjust its strategy or implementation. This could involve changing the
strategy, revising the objectives, or altering how it is implemented.

Types of strategic control

Premise Control:
• Premise control is one type of strategic control that focuses on the assumptions or
premises upon which a strategic plan is based. These assumptions could be about external
and internal factors such as market trends, consumer behavior, competition, political
environment, legal regulations, technological advancements, etc.
33
 • Premise control aims to systematically and continuously check whether these assumptions
are still valid and relevant. If the premises have changed, the strategy may need to be
adjusted, as decisions based on outdated or incorrect premises can lead to strategic
failure.
• Orascom that has developed a strategic plan based on the premise that there will be
steady economic growth in its key markets over the next five years. The company product
development, marketing, and expansion strategies are based on this assumption.
• Premise control, in this case, would involve regularly monitoring economic indicators such
as GDP growth, employment rates, inflation, and other relevant metrics in those key
markets. If the economy starts to decline or grow more slowly than anticipated, the
company would need to reassess its strategies. They might need to delay expansion plans,
adjust their product development timeline, or modify their marketing strategies to respond
to the changing economic conditions.
Implementation Control:
• Implementation control is a type of strategic control that focuses on executing the strategic
plan. It is used to ensure that the activities are leading to the desired strategic outcomes
and to detect any problems or deviations as early as possible. This control can provide
timely information about the progress and identify when a strategy is not turning out as
expected.
• Implementation control involves three main steps:
1. Setting Milestones: At the beginning of the strategy implementation, management sets
key milestones or targets the organization aims to reach within specific periods. These
milestones serve as markers to indicate whether the strategy is on track.
2. Monitoring Performance: As the strategy is implemented, management tracks the
organization’s performance against the set milestones. This could involve monitoring
key performance indicators (KPIs), such as sales, market share, customer satisfaction,
etc.
3. Taking Corrective Action: If the organization is not meeting its milestones or if there are
discrepancies between actual performance and the plan, management needs to
identify the reasons and take corrective action. This could involve adjusting the strategy
or how it’s being implemented.
• in Orascom a strategy to develop and launch a new software product within a year. They
would set milestones for different stages of the software development process, such as
design, coding, testing, and launch. Regular check-ins would be done to monitor progress,
and corrective action would be taken if there were delays or issues.
• Overall, implementation control helps ensure that strategies are carried out as planned and
that any issues are detected and addressed.

Strategic Surveillance:
• Strategic surveillance is a type of strategic control that involves broad-based and general
monitoring of events inside and outside the organization. The purpose is to uncover events
or trends that were unexpected, and that might impact the strategy of the organization.
•
• Strategic surveillance is not focused on any specific area but’s designed to detect
unexpected events that could affect the organization’s strategy. This could include changes
in the political or regulatory environment, new technological advancements, changes in
consumer behavior, market conditions shift, or competitors’ moves.

34
 • Orascom operates in multiple countries. Strategic surveillance for this company might
involve monitoring political news and events in those countries. If a major political event
could affect the business climate, the company could adjust its strategy as needed.
Special Alert Control:
• Special alert control is a form of strategic control designed to deal with immediate and
drastic changes in an organization’s internal or external environment. It is an intense and
rapid form of control that gets activated by unexpected and significant events that can
substantially impact the organization’s performance or survival.
• These events could include a wide range of situations such as sudden changes in the
economy, unexpected actions by competitors, regulatory changes, major shifts in consumer
behavior, natural disasters, political instability, or significant internal events like a major
product failure, labor strike, or a substantial drop in sales.
• When a special alert situation occurs, the normal routine of strategic control is suspended,
and an intense, focused analysis of the situation is carried out. This often involves a cross-
functional team of senior executives who gather to assess the situation, its potential impact
on the organization, and the appropriate response.
• Special alert control allows in Orascom to respond quickly and effectively to sudden,
unexpected situations, helping it navigate through crises and protect its strategic interests.
It underscores the importance of agility and adaptability in today’s fast-paced and
unpredictable business environment.

7.2. Using A Balanced Scorecard for Strategic Control:

• It takes a lot of work and resources to complete the strategic planning, execution,
and control process.
pondered. Strong support from the leadership group is necessary. Additionally,
workers must understand why Even if their objectives change over time, their
activities are significant and consistently strive toward achieving those objectives.
• A Balanced Scorecard helps to evaluate and monitor the overall strategy to those
day-to-day activities, giving more clarity about the what and why of strategic
implementation to the whole company. We will be able to do both operational and
strategic control within one framework, linking the two processes and getting
everyone on the same page. The Balanced Scorecard approach can provide a clear
insight on what companies should measure during implementation to enact strategic
control.

 Balanced Scorecard
Perspectives Targets Measures Initiatives
Asset Utilization
Rate Of sales growth Profitability
Total Cost Cost Leadership
Quick Ratio Return On Capital
Financial Financial Growth
breakeven point Employment
Ratio operating profit to Increased revenue and
income operating
income Increased
Customer Customer Customer satisfaction index Build Win-Win Relation
Satisfaction Customer loyalty index with dealers
35
 local market share
local sales volume
Increased market share
Dealer survey
Dealer gross profit growth
Competitive supplier
Average efficiency of energy
Energy Consumption
Yield Of production
Safe & Reliable Upgrade production
Internal Quality index
Efficient technology
Production rate
Business environment
Sales to nominal capacity ratio
Development of supply
Processes Quality chain of raw material
Inventory level
Cost leadership
Number of incidents
On spec-on time
Inventory management
Employee survey
Strategic competency
availability Employee satisfaction
Strategic information availability Employee satisfaction
Effective training Core competency and
Motivated and
Learning and Number of meetings between skills
prepared
Growth top Development of
workforce
management and staff successor plan
Enhancement of employee' Increased employees
skills key positions participation
Degree of encouragement for
team work

7.3. Measurement of performance:

The standard performance may be a benchmark with which the real performance is to be
compared. The reporting and communication tools & applications help in measuring the
performance. If appropriate means are available for measuring the performance and if the
standards are set within the proper manner, strategy evaluation becomes easier. But various factors
like a manager's contribution are difficult to live with. Similarly, divisional performance is usually
difficult to live as compared to individual performance. Thus, variable objectives must be created
against which measurement of performance will be done. The measurement must be done at the
right time; else evaluation won't meet its purpose. For measuring the performance, financial
statements like the balance sheet, profit and loss account must be prepared on an annual basis.
In order to track the development of the employee retention concerns, use an assessment
system to gauge the employees' grade level in addition to the Job Descriptive Index to gauge job
satisfaction.
• Given that fixed assets, ROI, EPS, and ROE account for a sizable share of the balance sheet
assets, the working capital and current ratio may be average when compared to industry
standards.
• The information systems in place at the organization are adequate for assessing how well the
suggested approach is working and for separating acquisition-related expenses.
• Use a rival in the market that is expanding quickly as a benchmark to determine how long the
firm can remain in a safe haven.
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• Comparing the company's performance on a monthly or quarterly basis. contrast the company's

7.4 Criteria for Evaluation:

•Return on investment.
• Profit margin.
• Return on equity.
• Market share.
• Earnings per share.
• Sales growth.
• Asset growth.

Section 4 - cufe.edu.eg, http://cufe.edu.eg/wp-content/uploads/host/2015/2-04-Section-4-

CEM-30-1-2014.pdf.

THE CONSTRUCTION SECTOR IN EGYPT DEVELOPMENT AND COMPETITIVENESS - AmCham,

https://www.amcham.org.eg/resources_publications/publications/business_studies/PDF
%20Files/constructionsummarycontents.pdf.

About - Orascom Construction, https://orascom.com/about/.

About - Orascom Construction, https://orascom.com/about/.

About - Orascom Construction, https://orascom.com/about/.

https://orascom.com/wp-content/uploads/Orascom-Construction-PLC-Corporate-Presentation-May-2022-1.pdf

https://orascom.com/wp-content/uploads/Orascom-Construction-PLC-Corporate-Presentation-January-2020.pdf

https://orascom.com/wp-content/uploads/Orascom-Construction-PLC-Corporate-Presentation-March-2023.pdf

https://orascom.com/services/construction/
https://orascom.com/wp-content/uploads/Orascom-Construction-PLC-Corporate-Presentation-September-
2021.pdf/

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