Unit 42 Workflow: Growth Opportunities, Ansoff’s Matrix, Funding, Exit/Succession Options, Business Plan

This report covers growth opportunities, frameworks, financial planning, exit or succession options, and a business plan for Oktra, the leading office design organisation in UK. It also discusses Ansoff’s Matrix, possible sources of funding for an SME, and more.

Unit 42 Workflow
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Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Growth Opportunities.................................................................................................................3
Ansoff’s Matrix...........................................................................................................................4
Possible sources of funding for an SME.....................................................................................6
Exit/Succession Options.............................................................................................................7
Business plan for an SME...........................................................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES:.............................................................................................................................12
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INTRODUCTION
Small and medium enterprises are playing an important role in the growth of nation. It
contributes in the economic growth that's why government provides many subsidies and extra
benefits (Park and LaFrombois, 2019). It is crucial for SME to plan so that they can expand their
business in the market. In this context, Oktra is undertaking which is the leading office design
organisation in UK. Oktra is offering a range of workplace services to the offices such as office
fit out, office design, workplace consultancy, office refurbishment, etc. They are thinking about
the expansion in the market so they need to do planning. In this report, it will covers growth
opportunities, frameworks, financial planning, exit or succession options, and a business plan.
MAIN BODY
Growth Opportunities
In today's competitive world, it is identified that organisations are facing a tough
competition in the market (Dodds, Dimanche and Sadowski, 2018). But still they want to grow
which can be possible by identifying growth opportunities. For the purpose of growth, it is
crucial for Oktra that they should consider some elements in their growth planning which are
discussed below:
Competitive advantage
It is very crucial for Oktra that they should possess competitive advantage in their growth
options. Oktra needs to consider this element in their growth opportunities as it is very important
for the growth of an organisation (Baschat, 2018). In order to expand a business, Oktra should
analyse that they have an opportunity to gain competitive advantage or not as it is the main
element for staying in the market.
 Pros: It is very important for an organisation that they should gain competitive advantage
in order to grow and become successful in the market.
 Cons: If company is not gaining any competitive advantage then they cannot able to
grow as they are not differentiated by other organisation.
New products & services
Innovation is the key of success and growth, that's why it is very important for Oktra to
consider innovation in order to expand their business. Oktra can be exp[and their business when
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they have new products and services which have some innovation that makes their products
different from other organisation (Zhou and et.al., 2017). It is very crucial in order to attract
customers. This will assists in growing of their business.
 Pros: It is really helpful for attracting new customers towards their organisational
products and services.
 Cons: Sometimes customers are not trusting to new products and services.
Growth options
This is an important consideration which is necessary to consider in their growth
opportunities so that company can expand their business in an effective way. Growth options
should be evaluated after analysing the situation of the market. It is very important in order to
grow a business in the market. All types of growth options should consider by one time so that
company can select the most appropriate which become successful for an organisation.
 Pros: This is really helpful in order to grow a business as company can able to evaluate
more an more growth options.
 Cons: It is the time taking process.
Collaboration
In the process of evaluating growth opportunities, Oktra should consider collaboration so
that employees are ready for doing work together. It is very important for the purpose of
effectively achieve goals and objectives.
 Pros: It helps Oktra to achieve their desired goals and objectives of an organisation.
 Cons: People are different perception level and thoughts so it create conflicts.
Ansoff’s Matrix
It is the tool which is used by organisation for the purpose of analysing and planning their
strategies in order to grow their business in the market (Ballaro and Polk, 2017). It is also known
as Product/Market Expansion Grid. It consists of four important growth strategies which also
include the analysation of risks which are associated with each growth strategies. All the four
strategies are mentioned below that assists Oktra to choose one of the best strategies.
Market Penetration
It is the first and foremost strategy for growing business. In this strategy, Oktra needs to
focus on increasing sales in existing market with existing products. They can apply this strategy
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with the help of number of ways such as decreases prices of products and services, increasing
promotions, and acquiring competitors. In this strategy, the risk level is very low.
 Pros: It is helpful in order attract new customers as it has low prices which can easily
attract customers' attention.
 Cons: It reduces the profit margin of an organisation which also decreases the growth
options.
Product Development
In this strategy, Oktra should focus on development of new products and services with
some innovation in the existing market. This growth strategy has a risk of product failure. This
strategy can be possible if an organisation invests in R&D departments in order to introduce new
products and services.
 Pros: It increases the customer base as they are attracted towards new products and
services.
 Cons: It increases the cost of products as it requires in investment in R&D department.
Market Development
This strategy is concerned with development of market that means Oktra introduces their
existing products and services in the new market (Chapin, 2017). This can be possible with the
assistance of catering different customer segments and entering into domestic or foreign market.
 Pros: It helps in increasing the customer base which also assists in increasing the
organisational revenues and profits.
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 Cons: There is a risk of difference of culture that creates problems and challenges for
organisation.
Diversification
It is an important strategy in which company diversified their products. That means
entering into new market with introduction of new products and services. There are two types of
diversification that are related diversification and unrelated diversification. Pros: This strategy assists an organisation to attract more and more customers as Oktra is
able to satisfying all types of needs and wants of customers.
 Cons: This is one of the most risky strategy in which an organisation needs to take proper
care for the success and growth of an organisation.
Possible sources of funding for an SME
Funding is very important for SME in order to grow a business in the market. It is found
that company needs to arrange funds so that they can invests in their growth opportunities. Funds
are the backbone of any organisation and it cannot be possible for an organisation to expand their
business without funding (Gounaridis, Chorianopoulos and Koukoulas, 2018). That's why Oktra
needs to find sources of funds which assists them to grow their business in the market. Some
important sources are mentioned below:
Bank loans
It is identified that this is the most common option for the small business in order to get
financial assistance from banks. It is found that banks have a special department in their
organisation which is dedicated to providing loans to small organisations. That means Oktra has
an option to take loan from banks: Benefits: Oktra can easily arrange funds whenever they want from banks. This is very
helpful in order to grow a business as they get financial assistance when they required.
 Drawbacks: In this option, there is high interest rate which identified that small
companies are not able to bear.
Debentures
In this options, small organisations can purchase debentures which is the long term
borrowings that helps an organisation to arrange funds (Krumholz and Hexter, 2018). It has
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many types in which some of them has required collateral security and some of the are not
required. It depends on the organisation that what they want to purchase. Benefits: Oktra can easily issue debentures in the market for the purpose of arranging
funds.
 Drawbacks: It is found that it becomes difficult for an organisation in order to build trust
on public as small organisations has less trust.
Angel investors
It is found that angel investors is found to be the first level of institutional investment.
Angel investors are the one who is ready for funding small organisations in terms of equity. Benefits: No on organisation are always ready to fund small organisation but angel
investors are always ready to fund small companies.
 Drawbacks: It is found that company is diluting their control and stake of their
organisation due to the equity of angel investors.
Exit/Succession Options
In order to grow a business, it is very important for an organisation that they should make
a plan for the purpose of exiting (Arzaghi and et.al., 2017). It is not an easy process as it requires
lots of research that which option choose by company. Some options of exit/succession options
are mentioned below:
Liquidation
In this option, an organisation liquidates their business of they found that company is not
gaining any profits and having many debts which they need to pay. It includes the end up of
business operations with sell of assets and pay off all liabilities. Benefits: It is the simplest and fastest way in order to get money out and pay to creditors.
 Drawbacks: It attracts higher income tax when company is profitable and wants to
collects earnings.
Acquisition
Acquisition is concerned with the acquiring of business assets by other strong company.
The acquirer pays premium to the company whose assets are acquired. It is one of the important
option in which company give their all assets to other organisation.
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 Benefits: It decreases the chances of business failure and also provide time to time
financial assistance.
 Drawbacks: The acquirer doesn't provide any stake and control to the organisation whose
assets are used by them.
Merger
Merger is one of the best option in order to continue the business. When company is not
able to continue their business lonely then they can merged with other organisation so that they
can share their losses as well as profits. They get financial assistance in order to continue their
business in the market. Benefits: Merger is very helpful in order to save the image of company and their
business in the market.
 Drawbacks: It is found that company needs to share their profit as well which reduces
their individual profits.
From the above options, it is identified that company has many exit options but it is
crucial for them that they should analyse each option. This can be possible with the assistance of
analysing benefits and drawbacks of each option. In the case of Oktra, it is found that merger is
effective in order to exit their business.
Business plan for an SME
Business plan is defined as the blueprint which produces by organisation for the future
transactions. It is the written document in which company includes all core business activities,
goals and objectives and how they achieve with a plan. In order to make a business plan,
company should perform SMART analysis. SMART analysis is defined as the technique which
assists a business analyst who describes the users' expectations. It is the process which includes
analysing, planning, documenting, elaborating, validating and managing business system
requirements. When company is analysing requirements then it is necessary for business analyst
to check all requirements according to the SMART technique. It includes specific, measurable,
achievable, relevant and time framed. The business plan of Oktra is mentioned below:
Business plan
Executive Summary It is very important for small business to plan for growth. This is
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necessary for company to evaluate all growth options in order to
expand their business successfully. For that purpose, company
should formulate a business plan that have all important activities
related to the future transactions.
Company Summary There is a business plan in relation to Oktra. It is one of the leading
organisation in UK that offers wide range of products and services
offered to the workplaces. They are currently plan to expand their
business that's why they formulate a business plan.
Products They are the interior designer which includes office fit out, office
design, workplace consultancy, office refurbishment, etc.
Market Analysis
Summary
It is very important for Oktra to set their objectives and after that
analyse their market so that they are able to achieve their goals and
objectives.
 To increase the market share by 15% in the market.
 To increase profits by 10% in next 2 years in new market.
 To make organisation recognizable in the market for
attracting new customers.
Marketing analysis is the qualitative and quantitative assessment of a
market. It is very helpful for business analyst in order to analyse
their market and take decision regarding expansion of business. For
market analysis, STP approach is undertaken. It includes
segmentation, targeting and positioning.
 Segmentation: In this process, Oktra is divided and
categorised their population or customers into similar
groups. So that they can easily find their target market. It is
found that Oktra categorised all offices in similar groups so
that they can identify their target one.
 Targeting: In this step, they need to select their target
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market and produces products and services accordingly.
 Positioning: This step is concerned with the reputation and
position in front of their target market so that they can give
reason to them to buy their products and services.
Strategy and
Implementation
It is very important for Oktra that they should formulate strategy and
implement in the organisation in an effective way. In planning for
growth, an organisation needs to select a strategy which is
appropriate for an organisation and after that implement with the
following of particular steps.
Management Summary The senior management of Oktra is managing all the functions
related to the expansion of their business. It is very important for an
organisation that they should handle all the activities effectively so
that they can achieve their desired goals and objectives.
Financial Plan Financial plan is very crucial in a business plan as finance is the
backbone of any organisation. Without finance, it is not possible for
Oktra to expand their business in the market. So they need to arrange
funds which cane be possible with the help of different options.
Some important financial options are debentures, angel investors,
banking loans, etc.
CONCLUSION
It can be concluded from the above discussion that small and medium organisations plays
a crucial role in the economic contribution. This is the reason that government wants to increase
the share of SME in market. For that purpose, they need to plan for growth with an appropriate
strategy. In this report, it covered growth opportunities considerations that assists an organisation
to grow their business. In addition to this, it is also covered Ansoff's matrix that consists of four
important strategy in order to grow a business. There are many funding sources are available in
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the market which assists an organisation to arrange funds in order to grow their business. It also
covered exit and succession options.
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REFERENCES:
Books and Journals
Arzaghi, E., and et.al., 2017. Risk-based maintenance planning of subsea pipelines through
fatigue crack growth monitoring. Engineering Failure Analysis, 79, pp.928-939.
Ballaro, J.M. and Polk, L., 2017. Developing an organization for future growth using succession
planning. Organization Development Journal, 35(4), pp.41-59.
Baschat, A.A., 2018. Planning management and delivery of the growth-restricted fetus. Best
practice & research Clinical obstetrics & gynaecology, 49, pp.53-65.
Chapin, T.S., 2017. Growth management in Florida: Planning for paradise. Routledge.
Dodds, R.A.C.H.E.L., Dimanche, F.R.E.D.E.R.I.C. and Sadowski, M.I.C.H.A.E.L., 2018.
Planning for growth in islands: The case of Cuba. Tourism Management in Warm-
Water Island Destinations, pp.95-107.
Gounaridis, D., Chorianopoulos, I. and Koukoulas, S., 2018. Exploring prospective urban
growth trends under different economic outlooks and land-use planning scenarios: The
case of Athens. Applied Geography, 90, pp.134-144.
Krumholz, N. and Hexter, K.W. eds., 2018. Advancing equity planning now. Ithaca, NY: Cornell
University Press.
Park, Y. and LaFrombois, M.E.H., 2019. Planning for growth in depopulating cities: An analysis
of population projections and population change in depopulating and populating US
cities. Cities, 90, pp.237-248.
Zhou, Y., and et.al., 2017. The effect of land use planning (2006–2020) on construction land
growth in China. Cities, 68, pp.37-47.
Online
The SMART business analysis technique, 2021. [Online] Available through:
<https://www.knowledgetrain.co.uk/business-analysis/business-analysis-technique-smart>
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