(Doc) - Strategic Management Solved Assignment

Running Head: Strategic Management
The a2 Milk Company
Strategic Management and Information Systems for business and enterprise

Strategic Management 1
Table of Contents
Part 1................................................................................................................................................2
Organizational structure...............................................................................................................2
Operational issues........................................................................................................................4
System acquisition method..........................................................................................................4
Control issues...............................................................................................................................6
Part 2................................................................................................................................................8
Development of accounting software..........................................................................................8
Market size...................................................................................................................................8
Leaders in the market...................................................................................................................9
Gaps and Challenges....................................................................................................................9
References......................................................................................................................................10

Strategic Management 2
Part 1
Organizational structure plays vital role in accomplishing the tasks and operations in an effective
manner. In order to perform the organizational tasks in a systematic manner, organizational
structure plays vital role and following the structure helps the organization to determine the areas
which require improvements so that the productivity of the organization could be enhanced.
Apart from this, organization could be able to develop an effective workplace environment. a2
Milk Company produces and distributes dairy milk products. Their milk contains A2 type of beta
casein protein. Apart from this, their milk is full of cream, yoghurt, and milk powders. Majorly
a2 Milk Company distributes its milk by supermarkets in Australia. Company was founded in
2007 and headquartered in North Sydney, Australia. Due to large number of activities, a2 Milk
Company is requires an effective organizational structure. It is a combination of several methods
and strategies which ensures the company to sustain for a longer period of time. The a2 Milk
Company (Australia) Pty Ltd is a subsidiary company of The a2 Milk Company Limited. Since
2000, company is expanding its business in different parts of the globe ad currently operates in
Australia, China, New Zealand, USA, and UK. With an effective organizational culture,
organization has managed its operations and expanded its business in international market in
short period of time (The a2 Milk Company, 2018).
Information technology also plays vital role in managing organizational structure in an effective
manner. Apart from this, IT leads to enhance organizational performance and attain competitive
advantage. Information technology leads the organization to move towards automation and
through this, chances for enhancing productivity increases (Nouri Koupaei, Mohammadi &
Naderi, 2016). This assessment will discuss requirement of accounting software will be
discussed along with determining its significance in the market. Further, assessment will focus
over structure of organization in relevance with The a2 Milk Company. In addition to this
assessment, strategic management policy will be evaluated in relevance with the feasibility as per
organizational operations.
Organizational structure
The a2 Milk Company was founded in 2000 in New Zealand by Dr. Corran McLachlan. He was
studying at Cambridge University at that time and found that proteins in milk affect people

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differently. During his study period, he learned that cow produces milk with beta-casein proteins
which are known as A1 and A2. Later on, he discovered the easiest way through which those
cows could be identified which produces milk which was A1 protein free. Then The a2 Milk
Company was formed with the motive of distributing protein milk. Today, company operates in
New Zealand, Australia, Hong Kong, Singapore, China, USA and UK.
As per Anzures-García, et. al., (2016), by distributing protein milk in Australian market,
organization has acquired an effective and distinctive position. Company is operating at small
level and it has approximately 110 employees. Company operates in Australian market with a
market share of 10% in overall milk industry in Australia. The a2 Milk Company is now being a
multinational corporation as it has expanded its operations in various countries across the globe.
The a2 Milk Company is not only selling milk and other products in foreign markets but they are
also distributing its products in urban as well as rural areas with the objective of development
effective brand image. Performing in foreign markets is not an easy task because there are
various complexities in performing operations in non-domestic market. This requires a company
to undertake technological, sociocultural, political, legal and economic systems. Multinational
organizational structure has been adopted by The a2 Milk Company with the objective of
enhancing its distributing range along with adaptation of certain methods to manage all the
functionalities of the organization from the headquarters. In this organizational structure, a setup
is required which could organise work and personnel in relevance with three functions i.e.
functional, geographical and other activities such as marketing.
Certain challenges have been overcome by The a2 Milk Company with the help of adaptation of
multinational organizational structure such as managing operations of all subsidiaries located in
different parts of the globe, gaining expected outcomes, fulfilling demand of target audience, etc.
Common organizational structure is also of no use for The a2 Milk Company because it has
various operations. Multinational organizational structure has helped the organization attain its
desired goals and objectives along with the fulfilment of target audience’s demand. Multinational
organizational structure is also useful for meeting with the future business environmental needs.
The a2 Milk Company has attained their desired goals until now in an effective manner and this
organizational structure will also help them to expand their business in further countries across

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the globe along with enhancing their market share in the Australian market (Galliers & Leidner,
2014).
Operational issues
Organizational efficiency, performance, productivity as well as acquired position in the global
market is being affected by various external environmental factors. Milk industry in Australia is
huge because number of supermarkets, hypermarkets and retail stores is huge and every
supermarket has its own dairy product and milk product’s brand. This has made the Australian
milk industry bit complex and intense. Half of the milk brands in Australia are majorly owned by
overseas companies. Primary competitors of The a2 Milk Company are Farmer’s Own milk,
Farmhouse Gold, Dairy Farmers, Dairy Choice, etc. All the companies are adopting unique
measures to make their products different from others but in perception of consumers,
competitive business environment is providing them higher quality of milk at low rates. Price
pays dominant role in terms of selection of daily required products and in order to attain
competitive advantage in the market, every organization is focusing towards attainment of
competitive advantage (Alston, Clarke & Whittenbury, 2017).
As per Christie, et. al., (2018), in order to determine the efficiency of organizational culture
adopted by The a2 Milk Company, authors have described sundry negative as well as positive
impacts. The a2 Milk Company has adopted several strategies with the motive of attaining
competitive advantage in the Australian market but due to weak accounting methods, absence of
innovative practices after inventing protein milk, organization is not able to stand aside from
other milk brands in the market. These issues and challenges are leading the organization
backwards. Apart from this, organization is still performing with traditional methods through
which they are unable to meet with the latest technological developments. It could also be
reviewed that competitors’ are continuously adopting new policies and measures to enhance their
performance and in order to compete with them along with development of an effective position
in the competitive business environment, it is necessary to adopt advanced measures so that
desired goals and objectives could be attained.

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System acquisition method
Information technology is rising rapidly and it is useful in every field. Most of the industries
have adopted information technological factors so that the desired goals and objectives could
easily be accomplished. In order to enhance the performance of The a2 milk company, they
should adopt software technology and other advanced mediums so that improvements could be
made in the organizational practices and the desired goals could be accomplished. Founder of the
organization has adopted software technology in business environment in order to gain the
leading position in the target market (Rosen, Sarracanie & Armstrong, 2017). These measures
have been adopted so that mission of the organization could remain same in order to determine
significance of protein type A2 so that large number of people could be served with nutritional
goodness and that too in real and natural milk.
Figure 1: Production and Sales flowchart of The a2 Milk Company.
This image showcases the production and processing of milk so that it could be distributed
amongst the target audience. The activities of this procedure will be discussed below:
 According to Ferzli & Ferzli (2015), before selling milk in the market, it is necessary to
extract milk from cows and to feed them. Further, a cow is sent for extraction of milk
procedure twice a day to the milking machines which is then stored in refrigerators. Then,

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it is sent to the dairy through tanker where further processing of milk is done in order to
make it nutritious real and natural milk.
 After processing, it is packed in bottles and then these bottles are sent to the supermarkets
so that it could get reached to the consumers for consumption purpose. Apart from
packing milk in bottles, other dairy products are also being made such as cheese, butter,
cream, etc. After making finished products, these are also sent to the supermarkets with
the objective of making it available for consumers.
Control issues
Lot of issues, challenges and problems arises within the workplace due to lack of adequate
control measures. In this scenario, it has been analysed that The a2 Milk Company does not have
sufficient accounting measures through which organization is not able to perform it in
appropriate manner. Adequate accounting measures are required in order to maintain the
accounting books in systematic manner along with maintaining transparency between the
investors and organization. Until and unless, organization will not be able to record its
transactions in systematic manner, measuring performance will be bit difficult task (Walker,
2018).
Following are certain crucial scenarios discussed which shows that due to lack of control
measures, certain types of issues could be occurred within the workplace:
 Major issue which commonly arises in the workplace is maintaining quality of the
products and services. The a2 Milk Company is engaged in the production of protein
based milk from cows in order to provide qualitative and healthy milk to the target
audience. In relevance to the maintaining demand of their milk in the Australian market,
it is necessary for them to maintain the quality of their milk along with adaptation of
advanced measures so that continuous improvements could be made in the quality of
their milk. Thus, it is necessary for the process managers who are responsible for
procuring the milk after extracting from cows so that the quality of the milk could be
maintained along with maintaining the A1 protein. Lack of control over storing the milk
in safe and secure places will affect the quality of milk and ultimately it will affect

Strategic Management 7
demand of the product as well as organizational performance (Asrar-ul-Haq & Anwar,
2016).
 In relevance with maintaining accounting books in systematic manner, it is necessary to
impose certain type of controls so that unauthorised person could not access the books of
organization. Financial statements plays crucial role in terms of attracting investors as
well as it is also showcases organizational performance. Comparison could also be made
in an effective manner with the financial statements with the organizational past
performance or with the competitors. Thus, it is necessary for the organizational
management to impose certain effective control measures so that the accounts could be
maintained in an appropriate manner.
 Recently, The a2 Milk Company has moved towards automation and along with
automation, several challenges and issues comes such as data leakage, data theft,
unauthorised access, etc. In order to keep the books of accounts in safe and secure
manner, organization is required to adopt certain security measures through which the
chances of data leakage, data theft, etc. could be reduced. This is necessary because
organizational information could easily be used for manipulating the target audience. It
will affect organizational performance as well as the acquired position in the target
market (Kang & Rowe, 2015).

Strategic Management 8
Part 2
Development of accounting software
Accounting software will help the organization to record its transactions easily. Further, financial
statements, ledgers and other books of accounts are created automatically. This reduces men
efforts and the chances of errors also get reduced. Manual accounting technique consumes more
time in comparison with the software accounting technique. Apart from this, there are certain
major benefits linked with the accounting software through which organization could easily
enhance its image in the target market. It helps organization to portray clear and transparent
picture in front of consumers, investors and competitors. Company could post their financial
statements of the year on their website so that it could be accessible by the stakeholders of the
organization. Clear and transparent books of accounts help the organization to show its current
position and performance in the target market. Apart from this, it has also been reviewed that
gaining competitive advantage, developing reliability amongst target audience becomes easy
tasks with the help of accounting software (Wickramasinghe, Cooray & Dissanayake, 2017).
Market size
Dairy industry plays vital role in Australia’s agricultural economy. In terms of farmgate value, it
stands on third position after beef and wheat market at $4.3 billion for the 2016/17 financial year.
Australia is a big player in international market in terms of exporting dairy products and stands
on fourth position behind New Zealand, European Union and United States. But in the same
year, national milk production has been decreased at 6.09% from the last year. These figures
showcase the overall performance of dairy industry in Australia. Thus, it could be noticed that
The a2 Milk Company have also faced low production which has affected the revenues as well as
profitability of the organization (Morioka & de Carvalho, 2016). Apart from this, it has been
reviewed that the number of dairy companies has increased in recent years which has affected
organizational performance in terms of revenues and profitability. New companies adopt fair
pricing strategies in order to develop effective position in the market which becomes challenge
for existing companies. In order to compete in the market along with maintaining the acquired
position in the target market, it is necessary to adopt and develop appropriate pricing strategies

Strategic Management 9
along with marketing techniques so that the desired goals and objectives could be attained
(Sheng, et. al., 2015).
Leaders in the market
The a2 Milk Company must be doing something right as it’s totally and udderly smashing its
competitors (BizClik Media Ltd., 2017). The a2 Milk Company is not growing in Australian
market only, it is also growing at rapid rate in other parts of the globe such as China. Sales of the
company have been increased by 62% in Australia and by 348% in China which is showing
organizational growth and success. Industry rivalry in Australian dairy industry is intense (Shortt
& O'Brien, 2016). Where all companies’ are struggling to regain its position in the market and
new companies are trying to set up their position, there The a2 Milk Company is leading the
market due to its qualitative and healthy milk (The a2 Milk Company, 2018).
Gaps and Challenges
Prior to the adaptation and implementation of ERP framework within the workplace, it is
required for the organization to identify the current gaps and challenges faced by the
organization while using traditional methods of accounting. This is necessary in order to build an
effective ERP framework as per organizational requirements (Tseng, 2016). ERP framework will
help the organization to remove all the issues and challenge faced by the organization before
implementing ERP framework within workplace (Prajogo, 2016). Major challenges and issues
related to traditional methods of accounting are errors in recording transactions, calculation
errors, inappropriate financial statements, etc. Considering these factors, an effective ERP
framework could be adopted by The a2 Milk Company with the objective of enhancing
organizational performance along with showcasing clear picture of organization in front of the
stakeholders (Kulkarni, et. al., 2015).
It can be concluded that ERP framework is required as per latest trends of market. With the
effect of introduction of information technology in business environment, lot of changes have
been recognised. IT has helped the manufacturing industry to enhance their productivity, it has
helped the service industry to manage and render services in more appropriate manner, etc. Thus,
it could be concluded that there are huge benefits of information technology whereas it also has
several threats such as data theft, leakage of data, etc. ERP framework is also a part of

Strategic Management 10
information technology and it plays vital role in recording daily basis transactions within
organization along with enhancing efficiency in an effective manner.
References
Alston, M., Clarke, J. and Whittenbury, K., 2017. Gender relations, livelihood strategies, water
policies and structural adjustment in the Australian dairy industry. Sociologia Ruralis, 57(S1),
pp.752-768.
Anzures-García, M., Sánchez-Gálvez, L.A., Hornos, M.J. and Paderewski-Rodríguez, P., 2016.
Semantic Formalism for Modelling the Group Interaction. Research in Computing Science, 118,
pp.137-147.
Asrar-ul-Haq, M. and Anwar, S., 2016. A systematic review of knowledge management and
knowledge sharing: Trends, issues, and challenges. Cogent Business & Management, 3(1),
p.1127744.
BizClik Media Ltd. 2017. The a2 Milk Company: a leader in the Australian dairy industry.
[Online]. Accessed from: https://www.fdfworld.com/company/a2-milk-company-leader-
australian-dairy-industry#. [5th May 2018].
Christie, K.M., Rawnsley, R.P., Phelps, C. and Eckard, R.J., 2018. Revised greenhouse-gas
emissions from Australian dairy farms following application of updated methodology. Animal
Production Science, 58(5), pp.937-942.
Ferzli, G.S. and Ferzli, G., JR., 2015. Stethoscope, Stethoscope Attachment and Collected Data
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Galliers, R.D. and Leidner, D.E. eds., 2014. Strategic information management: challenges and
strategies in managing information systems. Routledge.
Kang, M. and Rowe, D.A., 2015. Issues and challenges in sedentary behavior
measurement. Measurement in Physical Education and Exercise Science, 19(3), pp.105-115.

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Kulkarni, A., Hegde, N., Sharma, M., Kulkarni, A.A., Hegde, N. and Sharma, M., 2015.
Educational ERP systems in the market–a comparative study. International Journal of Innovative
Research Science in Technology, 1.
Morioka, S.N. and de Carvalho, M.M., 2016. A systematic literature review towards a
conceptual framework for integrating sustainability performance into business. Journal of
Cleaner Production, 136, pp.134-146.
Nouri Koupaei, M., Mohammadi, M. and Naderi, B., 2016. An integrated enterprise resources
planning (ERP) framework forflexible manufacturing systemsusing business intelligence (BI)
tools. International Journal of Supply and Operations Management, 3(1), pp.1112-1125.
Prajogo, D.I., 2016. The strategic fit between innovation strategies and business environment in
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Rosen, M.S., Sarracanie, M. and Armstrong, B., General Hospital Corp, 2017. System and
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Sheng, Y., Zhao, S., Nossal, K. and Zhang, D., 2015. Productivity and farm size in Australian
agriculture: reinvestigating the returns to scale. Australian Journal of Agricultural and Resource
Economics, 59(1), pp.16-38.
Shortt, C. and O'Brien, J., 2016. Overview of opportunities for health-enhancing functional dairy
products. In Handbook of functional dairy products (pp. 19-30). CRC press.
The a2 Milk Company. 2018. About us. [Online]. Accessed from:
https://thea2milkcompany.com/about-us/. [5th May 2018].
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Walker, S.Y., 2018. Workplace Issues: Am I in a Hostile Work Environment?. Teaching and
Learning in Nursing, 13(2), pp.95-96.

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Wickramasinghe, M., Cooray, N.H.K. and Dissanayake, S., 2017. Impact of accounting software
for Business Performance.