Small Business Growth Strategies

This assignment delves into the strategies employed by small businesses to foster growth. It examines the Ansoff Matrix for market expansion opportunities, the McKinsey 7S Model for organizational alignment, and Kurt Lewin's Change Model for implementing strategic shifts. Students will analyze these frameworks and their applicability in real-world small business scenarios.

SMALL BUSINESS
ENTERPRISE

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Profile of restaurant with its strengths and weaknesses........................................................1
1.2 Analysis of business using comparative measures of performance......................................2
TASK 2............................................................................................................................................3
2.1 Appropriate actions to overcome identified weakness in business.......................................3
2.2 Ways in which performance could be strengthened and maintained....................................4
2.3 Areas in which business could be expanded........................................................................4
TASK 3............................................................................................................................................6
3.1 Assessment of existing business objectives and plans..........................................................6
3.2 Revision of business plans to incorporate appropriate changes............................................7
3.3 Action plan to implement changes........................................................................................9
TASK 4..........................................................................................................................................11
4.1 Impact of the proposed changes on business and its personnels.........................................11
4.2 Plan how changes will be managed....................................................................................11
4.3 Monitor improvements in the performance of the business................................................12
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
In the competitive world of global business, small scale companies having lower
turnovers needs to make efficient plans so as to grow in a continuous time frame. Small business
enterprises are facing difficulties in many parts of the world and they are applying various
business methods to increase their profit. There are various analysis of enterprise's business that
can be using comparative performance measures (Zortea-Johnston, Darroch and Matear, 2012).
All these firm's needs to make changes, manage and monitor them on a regular basis so as to
compete with bigger organisations. In order to understand different approaches SBE which is
taken in this report is Delicious dish. It is a small restaurant in Edinburgh Scotland. This report
focuses on companies objectives and goals that are developed in order to flourish. This report
also highlights the measures taken by this organisation to remove its weaknesses, this would help
to understand the SBE planning strategies. It also showcases the ways in which company make
changes in its operating procedures, plans and structure in order to overcome various challenges
occurred in day to day operations.
TASK 1
1.1 Profile of restaurant with its strengths and weaknesses.
Generally the enterprises having turnovers less than 10 euros and having approx 59 staffs
comes under Small Business Enterprise. Delicious dish is similar kind of organisation having
limited resources. It is small restaurant located in Edinburgh city of Scotland. It is having approx
20 staffs and having turnover approx 5 Euros. Profile of this business is as follows:
 Objectives: As this company is operating in the business of serving quality food. So the
objective of this restaurant is three fold i.e. to serve good quality food in hygienic
atmosphere at affordable prices in order to achieve customer satisfaction.
 Context: This small sized organisation is working to serve people with several dishes at
affordable prices (Wynarczyk, Piperopoulos and McAdam, 2013). Edinburgh is a city
that attracts a lot of tourists so it will help company in sustaining for longer period of
time hence advocating its set up in this city.
 Competition: It is facing level of competition like never before with new and old set ups
established by bigger brand names. Approximately 65 -70 customers can be entertained

at a time whereas bigger organisations could serve up to 130 customers at a time. This is
a challenge in peak days which is posed by bigger restaurant chains.
 Key performance indicators: Supervisors and senior managers are involved in
observing staffs performance (Vázquez-Carrasco and López-Pérez, 2013). This includes
observations towards a staff working in team, checking out their punctuality, their
approach towards a problem and their work as a team member. They all were provided
with feedbacks.
To understand strength and weakness of the organisation SWOT analysis is as follows:
Strength:
 It is located in the area where there is large customer base.
 Presence of experienced staffs makes working process smoother that can help in serving
guests efficiently.
Weaknesses:
 Unstructured form of processes are followed and hence leading to confusion among staffs
when there is certain excess guest arrivals.
 Lack of proper management and planning.
 Less funds restricts company in their plan of introducing new products and services.
Opportunities:
 It can attract tourist which are increasing day by day.
 Government is supporting SBE with its policies and funding schemes.
Threats :
 High competition from small and big restaurant chains.
 Higher funds with other competitors as compared to this restaurant.
1.2 Analysis of business using comparative measures of performance.
Comparatives measures are highly useful in analysing and measuring performance. There
are several comparative measures that are used some of them are as follows:
 Customer satisfaction: The prospect of product or its related services is needed to taken
into account so as to compare the customer satisfaction (Storey, 2016). Firstly consumer
will like to expect considerations about purchase. Secondly experience gained with the
related services or product will be reflected in detected quality. Its relationship will be
observed when detected performance level remains less than anticipated levels. Levels of

satisfaction determines objective and subjective factors. According to assimilation theory
of satisfaction, consumers will take account of psychologically featured differences
among the anticipations regarding the restaurant and detected performance related to the
food and services (Mundial, 2013). Major potential of this organisation is hygienic
environment, dish price, cleanliness which is comparatively low in the area in where it is
operating.
 Employee's motivation: Employees are base resources of any organisation and strategy
implementation completely depends on them. So ensuring higher motivational levels of
worker is important. So as to measure the level of motivation Mc Gregor's theory of X
and Y can be used. Employees that are characterised under theory X are possessing lower
motivational levels as well as they are not committed towards their responsibility that can
be reflected back in their lower performance. whereas workers under theory Y have
higher motivational levels and hence having higher productivity because of their
commitment towards their responsibility (Muller, 2012). Front line staffs like two waiters
dislike their work even after they have been warned after analysis of their performance
report.
 Quality management: It is important for the restaurant to produce high quality food.
Approaches like TQM can be used to manage the quality as per the expectations of the
consumers and its service delivery. Ishikawa theory can be used to develop the quality of
services in the case of these restaurants. Planning deficiency, lower motivational levels in
staffs is negatively affecting the productivity.
Difference between Delicious dish and Purslane Restaurant -
Quality and healthy products - Delicious dish is a small restaurant in Scotland but they
provide quality and healthy food than others. Vision and strategy of this organisation is to
provide effective services and quality food to customers. Purslane is a well known restaurant in
Scotland but people do not appreciate its food quality more than Delicious dish.
Cost effective services – Delicious Dish is a small scale restaurant and their main
objective is to provides effective prices and quality food to customers. Purslane restaurant is also
provides same services to customers but their prices and cost are very high than delicious dish.
That's why customers do not believe in their cost and products.

Effective management – Delicious Dish has a effective workforce and management who
provides quick and manageable services to customers. Purslane Restaurant do not has a effective
management in their organisation that's why they are not able to providing satisfied services to
people.
TASK 2
2.1 Appropriate actions to overcome identified weakness in business.
Any company needs to take actions so as to overcome identified business weaknesses.
Some of the measures used in overcoming weaknesses are as follows:
 Government assistance: In UK government is providing advisory services as well as
monetary (loans) assistance to the small business enterprises. They are extending support
so that they can employee more number of people. Cabinet office has announced is
spending 11.4 billion pounds on small and medium size enterprises and its going to
exceed up to 3 billion every year. Proper investment can ensure growth in its path of
business.
 Proper planning: Officials of restaurant needs to generate plans in which all activities
are canned in proactive manner and it will be shared with all staffs before the
performance execution (Mahmood and Hanafi, 2013). It helps to reduce the cost and
misunderstanding among the workers regarding their job responsibility.
 Controlling activities: In order to identify the laggings in the service delivery all
activities of staffs should be measured. For improvement feedback must be shared
immediately.
 Managing resources: This SBE has small amount of resource and that needs to managed
by the company so as to grow sustainably in future. Human resource management needs
to be done efficiently.
2.2 Ways in which performance could be strengthened and maintained.
There are several ways in which performance could be strengthened and maintained. All
these ways needs to be analysed. Ways are as follows:
 To overcome decreased satisfaction level, restaurants owner should conduct market
research so as to get insight into the expectation level of the consumers. Feedbacks from
customers needs to be evaluated and worked upon.

 Feedbacks from customers should be promoted. In case of SBE owners are responsible
for making decisions. Democratic leadership style could help in increasing motivational
level of employees.
 Standard operating procedures used can be beneficial for improving the quality of
product and deficiency in staffs performance.
 In order to remove the conflict responsibilities should be delegated proactively and
definite structure must be provided.
 Workers performance must be evaluated and monitored with the tools of performance
management like performance appraisal (Goss, 2015). Partiality in identifying
performance can be overcome by this method and gives real picture of individuals
performance.
2.3 Areas in which business could be expanded.
For any company expansion policy is necessary. They needs to understand the areas in
which they can expand their business operations. Delicious dish restaurant has many areas in
which it can grow its business. Ansoff matrix can be used in this context which is four
dimensional and reflects four different strategies related to expansion and growth.
Four aspects are as follows:
 Market penetration: This strategy is adopted so as to increase the sales. Owners of
restaurant could introduce new services like organising events and parties, online table
booking can help in attracting more number of customers (Gorgievski, Ascalon and
Stephan, 2011). Sudden reduction in prices can be used to attract consumers towards
delicious dish restaurant.
 Market development: This is a strategy which is used when company plans to invest in
new site so as to increase turnover of business. This is not so effective strategy for this
restaurant as it has low cash base and this strategy requires large funds or huge
investments. Without heavy monetary funds this strategy cannot be successful.
 Product development: Another important strategy that company can use is product
development. This strategy is highly helpful in expansion plans (Giaoutzi, Nijkamp and
Storey, 2016). In this strategy restaurant can enhance their product range and existing
product's portfolio. It can also be applied in other services as well such as in the form of

providing free Wi-Fi services, changing recipes, change in the interior design, adding
new ways of presenting food etc. These changes and modification needs investment but
can help in flourishing and provide opportunities for growth.
 Diversification: This strategy is used for setting off the profit and loss in different
organisations divisions. This diversification can be in terms of products and services that
restaurants provides. Right now restaurant is not in a condition to diversify its business.
TASK 3
3.1 Assessment of existing business objectives and plans.
Every organisation whether small or large has certain defined objectives and plans. All
these plans needs to assessed on regular basis so that its effectiveness can be evaluated.
Assessment of objectives helps to understand the feasibility of it like whether it is achievable or
not in the current scenarios (Fassin, Van Rossem and Buelens, 2011). For this small restaurant
there are following ways to assess existing business objectives and plans:
source 1: Ansoff matrix, 2017

 Business objective: This restaurant has the business objective such as attracting more
number of consumers with quality dishes in hygienic environment. Cited organisation's
goal is to gain profitability and establishing name in the city of Edinburgh so as to
become the most reputed restaurant. It has an important positive point that using this
objective benchmark could be set. For maintaining and following the target direction to
the employees is provided by this objective. One of the negative point of this objective is
the lack of appropriate guidance so as to reach to the desired target. It must include ways
that helps to achieve the desired goals.
 Process: It is an better approach that assists organisational teams to keep standards in
order to reach to its goals. Process of business for the restaurant is not well defined this
arises the situation that creates doubts and lack of understanding in between staffs and the
responsibilities that are assigned to them (Eid and El-Gohary, 2013). Unanticipated
customer arrivals disrupts the business procedures sometimes. It implies lack of
flexibility in the procedures of company that can be understood as the negative side of the
restaurant. The positive side of the process is that its reporting authority is very well
defined. Supervisors supervises the front line staffs and they too are managed by two
managers of the organisation. The communication mechanism and process for
transferring of information in the organisational levels helps to maintain the coordination
among the staffs. For making a sound communication mechanism restaurant needs to
train employee on how to interact with customers and in between staff members.
 Performance indicators: By the process of observation restaurant can control staffs
performance. There are various performance indicators that are observed from time to
time. Direct face to face approach will showcase the true picture of performance level
(Curran and Storey, 2016). It can be understood as the positive side of observation. While
talking about the negative side of observation it can be seen that managers could not give
ample amount of time to observe each individual that can lead to improper judgement
based on the surface level analysis of the behaviour and commitment of each employee.
Thus it is important to conduct performance appraisal that involves workers rating by the
seniors and colleagues. It helps to reveal clear picture of their performance in their works.

3.2 Revision of business plans to incorporate appropriate changes.
Every company needs to revise its business plans so as to incorporate changes in the
structure, operating mechanism and quality of services and products produced by them. Revision
of business plans helps to overcome weaknesses of existing business plans. In these small
restaurant Mc Kinsey 7S model can be used that will underline and specify the objectives and
structure properly. There are seven elements in Mc Kinsey 7S model they are explained below:
 Strategy: This restaurants strategy should reckon employee control, financial activities,
operations, marketing, sales and other activities in order to gain higher profits and cope of
business will also be increased. Use of online tools can help in promotional activities can
be included in the marketing strategies. This would help to reach to a larger set of people
as use of internet is common these days. There must be hiring of one such employee that
has the role of to look after the daily activities of the firms operations (Cragg, Caldeira
and Ward, 2011). Improving motivational level of staffs and commanding their
performance needs to be included in the strategy. In order to achieve these two
appropriate training and orientation can be be beneficial that too when done at regular
basis. For example Delicious dish using quality product strategy to provides effective and
healthy food to their customer. To expend their business they use online tools that can
help in promotional and marketing strategies. This would help to reach to a larger set of
people as use of internet is common these days.
 Structure: It is important to define the proper structure of the organisation that includes
hierarchy of the restaurant. For reducing confusion restaurant must have a well defined
communication mechanism and hierarchy must also be communicated to all the workers.
This would help in increasing process of communication and flow of information.
Centralised or owner centred decision making process should be removed so that there is
sound flow of information and every employee in the organisation can feel their
importance. This would help to increase the motivational level of individual. For example
Delicious dish restaurant provides effective training to their employees for providing best
services to customers.
 Systems: It will give the essence to glassy operations in daily activities in the firm. There
are several structured systems such as orientation sessions by managers, reporting of
workers to their supervisors before the start of the day. These can be considered in the

system that would bring stream in the productiveness and also enhance competency level
of the workers. For this Delicious dish provides food and services in systematic manner.
Through this process their customers getting higher satisfaction in their food.
 Skills: Appropriate training and development program needs to planned so as to increase
the skill of the worker. It is a skill and performance of the employee that adds value to the
organisation and differentiate their values from others (Cowling and et. al., 2015).
Employees are needed for increasing the service quality. As example delicious dish
restaurant provides effective training to employees for providing better food and services
to customers according to their need and demand.
 Staffs: The restaurant has lesser number of employees and it is fact that its workforce
provides picture of its service quality. Staffs are differentiated by their competency level.
Performance control of the workers and directing them towards the appropriate path is
needed by the manager of the firm. This will bring uniformity in the methods and helps to
maintain coordination in between them. For example Delicious dish restaurant do not has
a large workforce but all the employees are their key strength who provides better
services to people.
 Style: Like other small enterprises this restaurant also follows autocratic leadership style
which needed to be changed. Styles like democratic or participatory can be used as an
alternative so that every staffs gets engaged in process of decision making (Chun and
Mun, 2012). Delicious dish restaurant uses various style in servicing and to motivate their
employees toward the objectives of organisation. Through this, they can easily get
success in future.
 Shared values: To increase the consumer's equity by keeping values will be the team
goal of the restaurant. All cultures and ethnic thinking needs to equally respected and
welcomed. Prohibiting any kinds of discrimination is role of the owner of the firm this
will help to achieve customer satisfaction. For Delicious dish, it is their objective and
vision to increase customers values to providing effective quality food in affordable
price. They provides higher satisfaction to customers and improve their organisation's
value in competitive market.

3.3 Action plan to implement changes
Changes are necessary for the organisation especially changes in structure and system
will strengthen the performance of company (Chun and Mun, 2012). But these changes brings
out confusion among the staffs that may lead to disruption in the business process of the cited
firm. It is important to manage these changes considering all its stakeholders. In the dynamic
business environment changes are needed to be done at regular intervals.
In managing changes of Delicious dish restaurant Kurt Lewin's theory of change
management can be applied. It helps to overcome demerits of changes by decreasing the resisting
factors. There are three elements of this model that includes:
 Unfreeze: This is starting process where owner link up the changes by highlighting the
inefficiency in existing plan and process. They also showcases that these changes will
increase the business of the organisation (Chittithaworn and et. al., 2011). These activities
are needed to be identified and shared with the workers in order to realise importance of
source 2: Mc Kinsey 7s Model, 2017

these changes. Various questions arises in the minds of employees and owners needs to
solve all these queries in a tactical manner.
 Change: In this stage changes are adopted by the staffs and they are compelled to accept
the new procedures in the firm so that they could give their best for the business growth
of the restaurant. This stage will witness the positive belief of the employees when they
sees that these changes are beneficial.
 Refreeze: It is the last stages of Kurt Lewin's changes will highlight the benefit in the
work process. Reduction in the misunderstanding levels will be discovered and firm can
achieve desired level of productiveness from the workers.
TASK 4
4.1 Impact of the proposed changes on business and its personnels
Changes are crucial for the restaurant as it helps to compete with other firms. It provides
a layout for maximising the profit. Any firm that is flexible in its organisational structure and
function always has a competitive edge over others irrespective of the scale of its operations.
One of the major drawback that is posed by this restaurant is limited space that restricts it from
attending large number of clients at the same time (Cavusgil and et. al., 2014). This problem
would affect the business in the longer time frame. These issues suggest that changes must be in
the planned way in the areas such as staff management, structure, guest handling so as to drive
source 3: Kurt Lewin Change Model

the value composition of the firm. The impact can be considered by analysing two sides. They
are as follows:
Positive impact: These structural changes will specify the flow of information and level of
coordination is also enhanced. The worker will be alert about the reporting authority and can get
basic informations relating to the responsibility. Democratic style of leadership will enhance the
motivational level among the workers without enhancing the cost involved in the company.
Performance monitoring will highlight the true productivity level of the firm. Mangers should
share the feedbacks with with staffs on the regular basis so that necessary improvements can be
made.
Negative impact: Every coins have two sides, citing this it can be understood that there are some
negative sides that is related to changes. It is fact that changes can only be successful when all
the employees contributes towards these changes (Bridge and O'Neill, 2012). But can be seen
that employees resist changes and they are hesitant in following changed system and process.
These hesitations creates conflict among higher authorities and employees of the restaurant.
4.2 Plan how changes will be managed.
Managing changes is compulsory so as to make it fruitful. There must be effective plan
that has to be made in order to manage changes. There are several aspects that needs to be taken
care of at various stages of changes. This is depicted through these points:
 There must be process of decision making that should have active participation from
every levels of workers. This will assist to ensure that company is in a position to check
that workers receive best possible outcome.
 Adequate briefing and training needs to provided to every employee so that they perform
their duties efficiently.
 There must be strong bonds between management and workers that helps in making
changes in appropriate manner.
In the point of view of restaurant Kotter's eight step model of change management can be taken
in following ways:
 The first phase will be making an urgency related to the proposed changes. The workers
must understand that changes are necessary in order to compete with other competitors
and grow as a business.

 The second phase will be leading staffs towards the alterations. Strong leadership skills
from managers are needed to influence the workers to follow the alterations immediately
(Blackburn, Hart and Wainwright, 2013).
 The third phase to make vision for the related alterations. It will aid workers in knowing
the need of alterations in the system and process.
 In the fourth stage emphasis will be given to the communication of the vision. All the
data must be provided by each worker in each levels.
 Fifth stage will be addressing barriers in the alterations and importance will be given to
the restrictions that is posed in smooth operations.
 Sixth phase accounts that there is requirement to create short term goals in order to detect
the success.
 Seventh phase will be addressing negative and positive side both and must be represented
in progress report.
 In the final stage in this theory suggests that there must be positive efforts that needs to
taken so as to achieve the benefits of the alterations in the long run.
4.3 Monitor improvements in the performance of the business.
In the coming years at least two years there must be monitoring of the improvement in
the execution. It is also necessary to track the progress and make improvements as per
requirement (Aremu and Adeyemi, 2011). The resilience towards the changes must be noticed,
observed and should be monitored. Balance
must be made and can be achieved. These are illustrated through these points:
 Financial Stewardship: This can be observed and measured for at least 6 months in
order to determine the performance of finance after the changes. What all impacts have
been posed on business turnover.
 Customer satisfaction: In order to grow as a company it is important to grow in the
competitive environment (Ackermann, 2012). Feedbacks needs to be noted down and
evaluated at regular intervals. Considerable changes needs to be made on these feedbacks
this helps to make customer satisfaction.
 Internal business process: There is a aim to increase levels of efficiency in the working
process. For this purpose appropriate training and smooth flow of information is needed

for bringing bonding and coordination. Internal business process needs to be effective for
future of the company.
 Organisational capacity: In order to establish customer delight innovation and creativity
is needed. Company has to increase its guest handling and production capacity in order to
compete with bigger firms.
 Performance measures and targets: Appraisal of performance needs to be done so as to
get clear picture of the levels of performance and target will be set for every worker so
that thee progress can be monitored. These evaluations needs to be in every six month.
Improvements representation using time scale:
Goals Period Review
One stop tradition By the end of 2015 Various kinds of dishes that
includes continental, Italian,
Chinese at one place.
Being number one in locality By 2015 Restaurant is trying to be
number one in the local area
by attracting more customers.
Service By 2016 Company has added services
like candle light dinners and
playing ambient music.
Increase customer capacity By the end of 2016 Company is adding
infrastructure so that large
number of guests can be
entertained at the same time.
CONCLUSION
There are various things that can be concluded from this report. As citing the example of
Delicious dish restaurant which is small business enterprise it can be seen that they need to
implement proper strategies so as to grow as an organisation and compete with other companies

dealing in this business. It can be seen from the report that SBE needs to make clear objectives
and plans and they need to be monitored. There are certain strengths and weakness of the
organisation and selection of the future expansion strategy must be done on this basis only. There
are several changes that needs to be made by the company in order to achieve their goals and
there must be proper plans so as to manage these changes.

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