Allied Worldwide Growth Strategies: A Business Development Report

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PLANNING FOR GROWTH
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Table of Contents
INTRODUCTION...........................................................................................................................................3
LO1..............................................................................................................................................................4
P1.............................................................................................................................................................4
P2.............................................................................................................................................................9
LO2............................................................................................................................................................11
P3...........................................................................................................................................................11
LO3............................................................................................................................................................14
P4...........................................................................................................................................................14
LO4............................................................................................................................................................19
P5...........................................................................................................................................................19
CONCLUSION.............................................................................................................................................21
REFERENCES..............................................................................................................................................22
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INTRODUCTION
This assignment is prepared to gain the understanding of the considerations that SMEs must
consider evaluating the growth opportunities. The SMEs must consider the different ways to
develop and grow to earn the desired profits for increasing the sales. This can be obtained via
the application of the different techniques that helps in identification of the opportunities for
the growth. Further SMEs must also consider the good sources of funding to attract the
investors for the organization. This assignment will discuss the types of funding that can be
accessed by the organization like allied Worldwide. This will also cover the business plan for the
Allied worldwide. This will cover the financial information and the strategic objectives. At last
the assignment has covered the different ways by which the small business owner can exit the
business and it includes the implications of the options for the same.
Allied Worldwide is the organization that delivers the successful IT solutions of all size of the
organization across the nation. It was founded in the year 1992 and it has the record of nearly
30 year. It provides the service from the fortune 500 powerhouses via SMEs. The organization
acts as the partner with the mission of enabling the IT service that must be delivered in a most
cost efficient manner with the model of the profit sharing and it is being designed to assist
towards the IT being zero cost for the business.
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LO1
P1
SMEs must have the ideas about the different growth opportunities continuously. This can be
attained only via gaining the competitive edge. Some of the considerations are as bellows that
can help allied worldwide to grow further:
COMPETITIVE EDGE:
The competitive advantage can be attained by the Allied worldwide via offering the innovative
services. Allied Worldwide can grow further with the help of the innovative IT services meeting
the needs of the customers. It will help to gain the competitive edge. The new opportunities in
the market that arise in the form of the needs of the customers can be used for gaining the
competitive edge (Allied Worldwide., 2019).
Resources:
Allied worldwide are rich in providing the solutions related to the IT and it includes IT managed
service, global IT outsourcing, Global IT resourcing and IT partnerships. By leveraging the
experience and global presence of the Allied Worldwide it provides benefit to the customers
and with providing the higher quality IT managed services the customers of the Allied
worldwide can focus to grow their business and increase the value of the shareholder. With the
help of the multi-lingual service professional that are highly skilled is being provided to the
customers with the It support (Allied Worldwide., 2019).
Core competencies and capabilities
Allied Worldwide provides the core competencies including technical expertise and including
the customer services. Dedicated and quality support services are provided by the organization.
Allied Worldwide have the more than 27 years’ experience, 250 certified experts, have the
global reach in 40 counties and also 100% user satisfaction. With the global presence, Allied is
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expanded in the new areas as the equipped developed technology including BPO, cloud based
solutions, ERP, analytics and consultancy (Allied Worldwide., 2019).
PORTERS GENERIC STRATEGY
The strategies have been formulated by the Michael porters who provides the option to gain
the competitive edge in the industry and which are as follows:
Figure 1: Porters generic Strategies
[Source: Wicker et al., 2015]
Cost leadership: This strategy can be utilized by the Allied worldwide for succession to gain the
competitive edge. Allied can adopt the two strategies for gaining the competitive advantage
which includes increase the profits of the company through decreasing the cost and to charge
the lower process to the customers and the other option is to charge the very lower prices to
make the normal sales with increment in the market share (Bel et al.,, 2018).
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Differentiation strategy: This can be adopted by Allied by providing the innovative services that
can help to make the differentiation in the industry. Allied Innovative can do research and
development and can introduce new services that can help to gain the competitive edge.
Focus strategy: Allied Worldwide can adopt this strategy focusing on the specific niche market
which can be done through the knowledge for the specific customers’ needs and market
dynamics. Allied worldwide can focus on lowering down the cost and selling well specific
products to the market.
Allied Worldwide can adopt the cost leadership strategy that can help to gain the competitive
advantage by reduce the cost of the products and offer the products by providing the average
price and it can also charge very lower process to make the average profit (Salavou, 2015).
NEW PRODUCTS AND SERVVICS
GE MATRIX
This is the model and matrix of the portfolio analysis that is being utilized for the classification
of the different product lines and strategic business units within the Allied worldwide. This
reflects the two aspects that must be considered by the Allied worldwide and which are as
below:
1. The attractiveness of the market and industry: Allied worldwide has the attractive
market size and the growth rate of this industry is also high and that is the reason for
the business expansion in other areas also. The profit margin for this kind of the services
like IT services solutions is also very high (Salavou, 2015).
2. Business Strength: The strength of the Allied Worldwide are its more than 27 years’
experience, 250 certified experts, have the global reach in 40 counties and also 100%
user satisfaction
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Linking competitive edge with the growth opportunities
POLITICAL
The regulations of taxation of UK are liberal
and that represents as the benefit for the
Allied Worldwide as it looks for the growth
and development and this policy will reduce
the cost of the business. The intervention of
the government affects the Allied Worldwide
operations. The current rate for the profits
of company is 19% and at will be reduced by
17% by 2020 this will affect the Allied
Worldwide (Wicker et al., 2015).
ECONOMICAL
The most important element in Pestle
analysis is the economic landscape of the
country and which is well that affects the
Allied worldwide to grow their business in all
nations. It has also been estimated that IT
services solutions will have high demand in
the coming future.
Social
The government faces the challenge to
balance the social welfare system for the
accounting for these future growth and
developments. This affects the IT solutions
services like Allied Worldwide to balance
same.
Technological
In UK the technological aspects affects the
Allied worldwide positively. The IT services is
associated with the technological aspects
and the demand of the Allied Worldwide
thereby increases. It can provide innovative
services to the market that can help to gain
the competitive edge (Policy, 2016).
Legal factors
Allied Communications is abide by the
government rules and regulations and also
law of health and safety that helps to retain
trained and competent workforce in the
organization. In different nations there are
diverse and different laws and regulations
that must be followed by the Allied
Environmental factors
Allied Worldwide ensures to have the CSR
and to ensure the sustainable growth and
development of the industry. Allied
Worldwide also ensures to consider the
environmental factors so that it any
activities of the organization does not have
negative impact on the environment ((Policy,
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Communications. 2016).
COLLABORATION
The collaboration can be attained by Allied Worldwide in two manners:
1. Vertical integration: This is the procedure that controls more than one phases of the
supply chain and in the procedure the company focuses for the conversion of raw
material into the products for selling the same.
Pros: it reduces the association of the suppliers
It also maintains the economy of scale
The prices will also be low
2. Horizontal integration: This is the procedure where Allied Worldwide can adopt the
mergers and acquisitions with the main rivalries of the industry. This helps in the
business growth (Rothaermel, 2015).
Pros: It helps to lower down the cost
The bargaining power will be increased
It manages the industry rivalries
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P2
Growth options: There are various growth options for the Allied Worldwide and which can be
evaluated and assessed with the application of the Ansoff matrix reflecting the strategies for
the market growth. Below are the elements of this matrix that can be used for the business
development and growth:
Market penetration:
This aspect allows increasing the share of the market with selling more product and
services. This also ensures to expand the existing business market. Allied Worldwide can
sell their products to the most familiar market which will reduce the risk and competitors
will not respond quickly (Harding, 2017).
Market development:
This strategy ensures to have the feasible option and it can be adopt by the Allied
Worldwide focuses to sell the existing products in the new area and markets. The market
opportunities will be explored by the Allied Worldwide in the different markets .
Product development:
This phase and strategy can be followed by the Allied Worldwide through selling the new
products in the current market. The Allied Worldwide can introduce and provide the
diverse range of the products in the current market. Allied Worldwide can go for the
development of the new product and to have the product extension strategies. This ensure
and can allow for the business expansion in the current market through launching new
products (Schawel and Billing, 2018).
Diversification:
Allied Worldwide can face high risk by adopting this option and which can include the new
products marketing in new market and area. This strategy does not provide the surety for
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the product succession due to the risk of new products and services. So it does not hold
upmost importance to adopt this option.
Allied Worldwide can adopt the market development strategy as it is the best option and
feasible for the organization. It can ensure the market expansion with existing products and
services (Schawel and Billing, 2018).
.
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LO2
P3
Investment appraisal
It is the method and means that addresses the fruitfulness of the investment project. It helps to
identify the project important and it has been selected. The investment project can include the
buying of the new equipment and new factory.
Types and kinds of the investment appraisal:
1. Payback period: It is referred as the total time taken for repaying the initial and first
cost of capital. It requires and includes the information on the profit and revenue that
can generate the investment.
Advantage:
It is the simple method
It is having the shortest payback time
Limitations:
It does not ignore the time value of money
2. The average rate of return: It includes the comparison of different profits which is
generated by the different investment with the cost of the investment.
Advantages:
It is very simple to calculate
It also considers the total profits
Limitations:
It provides the diverse outcomes to different users
3. Net present value: This method considers the facts and it includes the changes in the
value with the changes in the time.
Pros:
This method also includes the profitability of the company
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Cons:
This includes some guess work including cost of capital of organization
SOURCES OF FINANCE FOR GROWTH:
It includes diverse opportunities and possibilities for the business growth. The business finance
will assist for planning of organization. Below are the different finance sources which are as
below:
Bank loans: If Allied Worldwide goes for the planning for the expansion and growth and if
organization buys the machines for the existing business then the Allied Worldwide will
requires some money and fund. For the same the bank loan will be secured that will be the best
options and these options offers the low rate of the tax and interest and compares the credit
cards and overdrafts (Cournède, et al. 2015).
Pros:
1. It includes flexibility
2. It also ensure the profit retention
3. The bank loan for the business also have the advantage to pay interest on loan
and it is the tax deductible expenses
Cons:
1. The amount of loan does not represent any flexibility
2. It reflects burden to repay
II Peer to Peer lending: It is the most common and fast growing method for the businesses that
includes raising of the loan finance with no use of the traditional banking sector. This includes
raising the loan from the different groups (Peirson, et al. 2014).
Pros:
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