Strategic Planning, Flexibility & Innovativeness: Impacts on Firm Performance

This assignment examines the relationship between formal strategic planning processes, planning flexibility, innovativeness, and their effects on firm performance. It draws insights from eight academic sources, including journal articles by Eddleston & Crittenden (2013), Grünig & Morschett (2017), Guerzoni & Desai (2014), Okagaki & Dean (2016), and Wolf & Floyd (2017). Additionally, it considers exit strategies for small businesses, financial funding sources, and Ansoff's Matrix. The assignment requires a critical analysis of these concepts and their application to enhance firm performance.

Planning for Growth

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK-1............................................................................................................................................1
P1 Key considerations for evaluating growth opportunities..................................................1
P2 Applying Ansoff's growth vector matrix on opportunities for growth.............................3
TASK-2............................................................................................................................................6
P3 The potential sources of funding and its advantages and disadvantages..........................6
TASK-3 ...........................................................................................................................................8
P4 A business plan for growth................................................................................................8
TASK-4..........................................................................................................................................11
P5 The benefits and drawbacks for exit strategy option available for small business.........11
CONCLUSION..............................................................................................................................12
REFERENCES .............................................................................................................................13

INTRODUCTION
Today the business ways of operating business have change a lot. More and more
businesses are planning for growth in their business. They are making strategies and plans in
order to brings this change in their company. For this they are making use of digital technology
in order to increase their sales and earn more profit in business (Okagaki and Dean, 2016).. The
use cloud-computing have proved beneficial for many companies as it makes the work easier in
the organization. All the necessary information is kept safely in a cloud. The use of digital
technology will also will help company to provide products and services as per the needs and
demands of customers.
Talon outdoor UK is a small-scale independent media specialist organization (Talon
outdoor , 2017). The outdoor advertising are planned and purchased in this organization. The
advertising such as engaged public spaces are planned and purchased. In this report the growth
opportunities for Talon outdoor will be evaluated. On the opportunities of growth the Ansoff's
matrix model will be applied. In this report the various sources of funding will be discussed and
its advantages and disadvantages for the company. This report will discuses the exit options that
is available for small-organization and also a business plan for growth will also be made in this
report.
TASK-1
P1 Key considerations for evaluating growth opportunities
In order to expand the sales of company and also to increase its share in market. Talon
outdoor need to take into consideration the opportunities for growth. The great impact have
developed on business due to digital technology. With use of this technology more innovative
products can be created by companies. These products will attract customer and in this way
companies can increase their profit and gain competitive advantage over competitors.
The following are the key consideration for evaluating growth opportunists of talon outdoor
Use of cloud computing- Today more and companies are making use of cloud-computing as it
saves both time and its implementation in the company is not so costly. For storing records and
information of employees and customer the company can consider it as a growth opportunity. As
before manual process were used in order to store records of customer and employees. But in the
manual process a lot of time is consumed and is difficult to do upation in manual process (Wolf
and Floyd, 2017). So, the companies make use cloud-computing as storing data and information
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in the cloud is easy. All the information regarding company is stored in one cloud and it also
secures has only authentic users can access the infiltration on that cloud. There are numerous
advantages of using cloud in organization .
Use of mobile technology and social media sites – The use of mobile technology in business has
also changes the way business operates their business .As technology such as cell phones help
employees and customer to stay in touch even after office hours. The employees remain in
contact with business even after office hour. It has increased productivity of business and due to
their the engagement of employees in their work is more. Today employees can communicate
with employees that are there in other countries with use of mobile phone. It has made process of
communication in the company efficient and easier(Phillips and Moutinho, 2014). The latest use
of technology such as video conferencing has helped organization to contact face to face people
and customers outside other counties. This will help employees to explain the people in detail
about their business in detail with this they can also understand the needs of customers as well.
So, for both employees and business use of mobile phones and video conferencing is beneficial.
The company Talon outdoor can conduct its meetings by using video conferencing with other
employees outside country.
Use of social media sites such as Facebook, twitter and blogs etc have also changed the
way in which marketing is done by company of their products and success. Today more and
more companies make use of digital technology in order to promote its product in the market. If
there is any new products that is developed by company and in order to make consumers aware
about that product company use these sites. By using Facebook any company will create a page
of its company and products and services offered by company will be mentioned in that page.
The customer who are interested can click on like button and this will help the company to
recognize the number of customers that are interested in product and services of company. The
strategies and plan will be made keeping in mind these customers. The preference and lifestyle of
customer can also be analysed through social websites as the company will know about the
latest trends and preference about customer.
Use of big data in business- This can also be used by companies for the growth of business. This
will help them to analyse huge amount of dataset to use of big data innovative and creative
products can be created in a business. In order to understand trends, patterns and preferences in
huge database the concept of big data can be used. The most valuable customers can be
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discovered for the business by using analytics in organization. The use of big data at organisation
will help the companies to gain insight knowledge about liking and preference of customers and
this will help to gain competitive advantage over rivals. With help of big data the profile of
customers can be checked and analysed. In this way the desire and requirement of customers
will be understood by organization. The ways off collecting data is provided by big data so the
important changes and re- development in products can be done. With big data the feeds on
social media and blogs can also be analysed and scanned. This a lot positive change in the
organization can be brought by using this digital technology
Use of internet of things – This will help the company to develop more smarted product for their
clients. This will reduce explained for the company as there is no need of security guards in order
to see the security department of business. As with use of internet of things the company will
use of digital technology which will ensure the security of company .This security technology
will help the company to know about any theft that is taking place in the company. So , this
digital technology will also benefit the company.
Boston consulting Group matrix
The Boston consulting groups product portfolio matrix is therefore designed in order to
help with long term strategic planning. This will help a business to consider growth opportunities
by reviewing its portfolio of products to decide where to invest, to discontinue or develop
products. This helps in evaluating the strategic position of the business brand portfolio and is
therefore
P2 Applying Ansoff's growth vector matrix on opportunities for growth
To the opportunities of growth of company Ansoff's growth matrix can be applied. It is
also trends as product grid matrix. In these models the four strategies are made in order to plan a
growth in a company. They are as follows-:
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Illustration 1: Ansoff's Matrix
(Source: Ansoff’s Matrix, 2016)
Market Penetration – The similar products are sold in the exiting market. The business need to
find out new ways in order to enhance loyalty of customers and grow lifetime values of business.
Market development – By using this approach the new customers are targeted by the exiting
market . A new customer can be defined by making use of demographic such a country, age , sex
etc. The company can make use of campaigns, advertisements etc in order to sell its services to
target customers (Okagaki and Dean, 2016).
Product development - A change in the product and its services is done in order to sell the new
products to existing customers. In order to sell these products to existing customers. The
company can make its products more creative and innovative to sell it to existing customers.
This will help the organization to increase its ales and earn profit. The loyalty of customers will
also increase as innovation is done by company in its products.
Diversification – In this the company will develop new products for new market.
Existing products New products
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Existing market Market penetration
 In existing market,
more products will be
sold out (Seyed-
Javadin and Safari,
2014.).
 More media specialist
companies will be
targeted.
Product development
 To existing
customenrs , the new
products will be sold
out .
 Innovation at media
company.
 Making use of new
technology such as
social media site in a
business.
 Big data will be used to
gain insight about
customer profile an
analysed their
preference
New market Market development
 There will increase in
market share for the
company Talon
Outdoors and also
around the globe.
Diversification
 The services will also
be provided in other
parts of the world.
 The cloud-computing
will be used to keep
records of employees
and customers.
Applying this model on growth opportunity of talon outdoor
Market penetration – The company will continue to provide its medial specialist services in the
current market of UK.
New products – In this the innovative and creative products will be launched by company in
existing market. In order to do promotion of its new products the company may use of social
sites such as Facebook and twitter for promotion.
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Market development - In the new market the company will sell its existing product. Based on
demographics it will sell its products.
Diversification - In this company will make use big data to product understanding of customer
and new market will also be targeted in this.
TASK-2
P3 The potential sources of funding and its advantages and disadvantages
In order to conduct business there are various sources of funding that can be
considered .They are as follows-:
Angel investors
In a business they will have a background and will invest funds in a business. The
business is share is taken by them in return of their investment done in business. The
disadvantage of using angle investors is that the investment that is done by angle is less risky in
comparison with debt financing. The business is well understood by these type of investors and a
long view is taken by them. The disadvantages of taking these investors is that complete control
as a part of owner is lost (Kardong-Edgren and Leighton, 2016).
Venture capitalists
In the area of internet ,digital media and clean technology .These investors will hod to
invest within 3 years of start-up. The advantages of this funding is that they are business
expertise and a valuable sources of guidance and consultation is given by them in the business.
This will help the company to make better decisions in areas related to financial management
etc. The active support in areas related to legal,tax and personal matters can be provided by
them. In the community of businesses venture capitalists are well connected. The disadvantage
of this funding is that the control of owner will be lost as all decisions regrading business will be
taken by this investor.
Government and European grants
There is no need to pay grants form UK government. There are both advantages and
disadvantage with UK grants. The advantages can be that over the business no control can be
taken and also that there is no need to pay back the grants that is given by government of UK.
Different types of grants are available and as per the needs of company the correct grants need to
be find out. A lot of competition is there for grant as is not needed to pay the grants that is given
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by UK government (Phillips and Moutinho, 2014). The disadvantage can be a lot of time can be
consumed in the process of application. The instant credibility and public exposure can be given
to organization from these prestigious grants. A ton of hard work and researching and planing is
usually need to prepare government for these grants.
Government-guaranteed lending schemes
This scheme runs in UK with conjunction with banks of UK. With this scheme 75% of
loans is guaranteed. The advantages of this scheme sis that the amount of loan can both bigger
and smaller in numbers. As per the preference of company the rates of interest can be both
variable and fix. The loans and overdraft can be chosen as per the requirement of business
Commercial finance
In long years the repayment can be done and for the business it is efficient. There is need
to give some sort of security for this (Financial funding for a business, 2017).
Equity finance
With use of equity finance different demands of businesses can be placed. In comparison,
with other source of finance such as banks, loans equity finance is more appropriate. Some
advantages of equity finance can that to the business funding is committed .There is no loan to
repay with equity financing. In several ways this offers relief. The monthly payment of loan need
not be made by business. If the company lack creditworthiness than equity can be more
preferable in comparison with debt financing. The partnership can be formed with equity
financing .This will help benefit the business in their growth. The disadvantage of equity finance
is that the profit need to be shared among investors and also the power will also loose a control
over business. There can be some tension and conflict due to sharing of ownership and while
working with other. If in the company there is there are an issue of creditworthiness then equity
finance is a better option .
Personal savings and assets
A great source of capital can also be made from personal savings and other assets. The
price of acquisition are less as the individuals already posses them. The interest on a bank loan
need not be pay on this. And also with investors there is no need to share returns. There is a
drawback of using personal savings in a business .It is that while using this business if there is
any downfall in the business then there are chances that one can loss all its personal savings. It is
not a good option to place assets such as retirement accounts etc to risk.
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Investors
In the business the investors may be active partners. There are also some silent investors
who juts invest in the businesses and provide capital silently and wait for their returns. A certain
limit of control over the business is taken by these investors.
Bank loans
A good source of funding is private banks. For small ventures one secure personal loans.
In order to utilize it as operating capital the money can be kept in hand. This money can be used
by company during the time of downfall. The disadvantage of this is that whether the business is
doing good or bad the rate of interest need to be played on it.
Peer-to-peer funding- peer-to-peer funding is termed as the practice in which money is
landed to individuals or business through online services that match lenders with borrowers.
Crowd funding- Crowd funding is a practice of funding a project or venture by raising
small amounts of money from large number of people, typically via internet. It is also termed as
crowd sourcing and alternative finance.
TASK-3
P4 A business plan for growth
Executive summary
In order to ensure growth in company it will make a business plan for it. This business
plan that is made by company will include the implementation of cloud -computing and interest
of things at company and also based on this financial information will be provided. The cloud-
computing will be implemented at the Talon Outdoor in order to maintain records and
information about employees and customer (Grünig and Morschett, 2017). Main strategic
objective of the company is to implement cloud computing and interest of things at company.
Company overview
Talon Outdoor Limited provides integrated campaign solutions. The company offers
traditional outdoor media, experiential activity, mobile telecoms, and event sponsorship services.
It serves media owners, advertisers, and other parties interested in the outdoor medium. The
company was founded in 2007 and is based in London, United Kingdom.
Vision mission objectives
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To to implement digital technology cloud computing at their business is the mission
statement and vision is to focus on delivering innovative and forward thinking strategic OOH
solutions that is integrated with wider communications.
Market analysis
SWOT analysis of Talon outdoor
Strength
 Leading market position
 Diversified global markets
 Vigorous financial performance
Weakness
 Risks related to changes in applicable regulations
Opportunities
 new contract wins may improve brand image
 Expansion through acquisitions
Threats
 Intense competition
 Foreign exchange risk.
Marketing budget
Expenses Cost
Advertising expenses £ 20
Distribution expenses £ 50
Raw materials expenses £ 60
Total £ 130
Cash Flow statement
Cash flow statement of
Company Talon Outdoor
FY 31st March 2018
Cash flow from operations Amount (in £)
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Net earnings 2000000
Addition to cash
Depreciation 10000
Decrease in account receivable 15000
Increase in account payable 15000
Increase in tax 2000
Subtract from cash
Increase in inventory -30000
Net cash from operations 2012000
Cash flow from investing
Equipment -500000
Cash flow from financing
Notes payable 10000
Cash flow 1522000
Risks and milestone
There are several risks in development of cloud based system. Therefore, it helps to
create successful network that also ascertained with maintaining effectiveness. With this
consideration, milestone must be set by the company to focus on development of tools and
techniques that helps to create successful business plan.
Resources required in business plan
Talon Outdoor considered different types of solution in integrated traditional outdoor
media, experimental activity, mobile telecom, etc. Therefore, they need to focus on technical,
HR and many other resources that are needed to accomplish successful business plan.
Risk in the business
Types of risks Low Medium High
Technical
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Financial
Market
Gantt charts for milestone
Strategic objective
Talon Outdoor has strategic objective to implement cloud based system so that effective
network with mobile also successfully develop that ascertained creative results. Therefore,
business will design to attain more goals to create effectiveness.
Monitoring and evaluation
In the implementation of internet of things the company will make use of smarted
products at company. The company is planning to implement a smart security system for the
company. This will reduce the spends of having awho all are coming and gong to company and
also keep security of each department of this company. This will beneficial for the company as it
do not have to monthly expense to security guards for keeping an eye security guards at the
company. This system will provide details about customer and employees ta company .This
implementation of smart security system will be expensive but once implemented the company
need not pay monthly expense for it. So, the company can apply for bank loans for this
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time,nations. And once the bank loan is granted it can slowly pay back that loan. For the
security of company this smart secure system is good as with this owner can monitor
continuously all departments (Dibrell, Craig and Neubaum, 2014).
In company before the manual records were made and maintained of customer and
employees. This was not an easy process as lot of efforts is needed to maintain such records. For
each customer and employees there is a need to search record and a lot of time is consumed of
employees in maintaining such records. Also in case of any fire and theft there was a risk of
security of these records. And the backup was also not available of these records. It is also not an
easy job to update these records as it is difficult to make updation in each records.
Due to these companies decided to implement digital technology cloud computing at their
business. Today mostly all business make use of cloud-computing in their business. With the
company can fulfil its objectives of expanding business on broader scale. The objective of the
company is to earn profit in the market and expand its business on a wider platforms. This
implementation of cloud computing will allow the company to store all information and data of
company safely on one cloud. The only need of cloud-computing is internet access. With this
employee and customer can access their data anywhere they jut need an internet connection to
access their data and information. It also provides security as only authentic users can access the
information that is available on cloud. And there is no need to worry about backup as data is
stored on cloud and backup is also available. The updation in cloud is done automatically. It will
save a lot of time of the company and employees .The financial information about cloud
computing is that implementation of cloud-computing is not so costly. As no hardware or
equipment need to be purchased for it. So by taking loans from some investors the company can
implement cloud and pay the loan afterwards. The implementation of cloud is also energy
efficient as all information about company will be there on one cloud as less amount of carbon
footprint will be there (Eddleston and Crittenden, 2013). As today customers prefer more
sustainable practices as it will generate more satisfactory among customers.
TASK-4
P5 The benefits and drawbacks for exit strategy option available for small business
For any business plan the strategies of exits also play an essential role. With help of exit
strategies the owners of business can quit the business. The strategies of exit are essential for
investors and lenders as they want to know whether their money is secured or not. Different
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types of strategies are there in a business. This business strategies mainly depends on type and
size of business.
They are as follows-:
Merger
In one business the two business re join together. Due to mergers the value of business
increases. In order to go though with merger as exit strategy one need to be part of a business. By
new merged business the employees will be given job opportunities.
Acquisition
It is termed as acquisitions when a company buys another business. The person who
purchase the business is given the ownership. For acquisitions this is the exit strategy. There is a
need to sign a non complete agreement with an acquisition (Exit strategies , 2017).
Sell to someone
As an exit strategy the business is sold to someone. It can be sold to members of families
such as brother, sister and other relatives. The business can be sold to family if they are
interested in the business. It is not an easy task to develop family succession plan.
Initial public offering(IPO)
In this company is offered to public. In this there are both private and public business.
The advantages of this is that in a public the company is taken so it is profitable. But it is quite a
costly process for small companies (Albon,Iqbal and Pearson, 2016).
Liquidations
When the company is not able to pay debts the company is liquidated. For small-business
this exit strategy can be used . In this no negotiation need to be done as it is a clear-cut strategy.
If any business is liquidated then the reputation and business will be lost.
The company need to plan from before in order to select the best strategy from the above
mentioned exit strategies. The plan that is made by company regarding exit strategies should be
profitable for company and should be able to get maximum profit from that strategy.
Management buy out
It is termed as a transaction where management team of a company purchases the assets
and operations of the business that they manage. A management buyout is appealing to the
professional manager because of greater potential rewards from being an owner of a business
rather than that of employees.
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CONCLUSION
Thus summing up the above report it can be concluded that in the growth of company
digital technology such as cloud computing, mobile technology etc plays an bestial role. The
company can make use of mobile technology such as cell phones in order to make the
communication in business more efficient. The social websites such as Facebook, twitter can be
used by company in order to conduct marketing of their products and services. With
diversification of Ansoff's models an innovative product for new market can be developed. The
government grants, angle investors, equity finance etc are some sources of funding. The business
plan made will implement cloud computing and smart security system at company. The cloud-
computing will store all records and information related to company. The exit strategy such as
IPO, acquisition need to be planned from before. The planning need to be done by company
before exiting business.
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REFERENCES
Books and journals
Albon, S.P., Iqbal, I. and Pearson, M.L., 2016. Strategic Planning in an Educational
Development Centre: Motivation, Management, and Messiness. Collected Essays on
Learning and Teaching. 9. pp.207-226.
Dibrell, C., Craig, J.B. and Neubaum, D.O., 2014. Linking the formal strategic planning process,
planning flexibility, and innovativeness to firm performance. Journal of Business
Research. 67(9). pp.2000-2007.
Eddleston, K.A., and Crittenden, W.F., 2013. Planning for growth: Life stage differences in
family firms. Entrepreneurship Theory and Practice. 37(5). pp.1177-1202.
Grünig, R. and Morschett, D., 2017. General Strategic Planning as the Starting Point for Going
International for New Markets. In Developing International Strategies (pp. 57-65).
Springer Berlin Heidelberg.
Guerzoni, M. and Desai, S., 2014. A new industry creation and originality: Insight from the
funding sources of university patents. Research Policy.43(10). pp.1697-1706.
Kardong-Edgren, S. and Leighton, K., 2016. Challenging the System: Building a Sustainable
Educational Research Program Using Innovative Funding Sources.
Okagaki, L.H. and Dean, R.A., 2016. The influence of funding sources on the scientific
method. Molecular plant pathology. 17(5). pp.651-653.
Phillips, P. and Moutinho, L., 2014. Critical review of strategic planning research in hospitality
and tourism. Annals of Tourism Research. 48. pp.96-120.
Seyed-Javadin, S.R. and Safari, M., 2014. Presenting a conceptual model to explain the role of
strategic management and planning in Islamic banking competitiveness. International
Letters of Social and Humanistic Sciences. 26. pp.46-56.
Wolf, C. and Floyd, S.W., 2017. Strategic planning research: Toward a theory-driven
agenda. Journal of Management. 43(6). pp.1754-1788.
Online
Exit strategies . 2017. [Online] Available through: <https://groundfloorpartners.com/exit-
strategies-for-small-business-owners/>.
Financial funding for a business. 2017. [Online] Available through:
<https://www.inc.com/guides/business-plan-financial-section.html>.
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Talon outdoor . 2017. [Online] Available through: <https://talonoutdoor.com/>.
Ansoff’s Matrix. 2016. [Online] Available through:
<https://thecimastudent.com/2016/11/16/cima-e2-ansoffs-matrix/>
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