Strategic Analysis of Aurecon Singapore's Business Development Plan

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This report analyzes Aurecon Singapore's business-level and corporate-level strategies, focusing on how the company can increase its market share within the service industry. It uses Porter's generic strategies and the Ansoff Matrix to evaluate Aurecon's current positioning and suggests a shift towards a differentiation strategy that includes lower-cost services to broaden market reach. The analysis emphasizes market penetration through innovation and leveraging existing market knowledge. It suggests leveraging technology to address talent shortages and meet increasing demand, aligning with Aurecon Singapore's vision of innovation and high-quality service delivery to enhance its competitive edge and market share.
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Managing in Practice 1
MANAGING IN PRACTICE
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Managing in Practice 2
Managing in Practice
Aurecon Singapore
Aurecon Singapore has been offering its services to the high-end market. however, it is
now considering ways in which it can increase its market share for its services. This section
seeks to analyze Aurecon Singapore in relation to its business-level strategy, corporate level
strategy and innovation while concentrating its service industry. In order to gain a bigger market
share, Aurecon Singapore has to change or improve its strategies. This is achievable through an
analysis of the present current market strategies and align them with the desired goal that is, to
increase its market share for its services.
Business level strategy
The analysis is done using the porter’s generic strategy diagram which is as shown
below: -
Aurecon porter’s generic strategy diagram
Competitive advantage
Lower cost Differentiation
Competitive
scope Broad target
Cost leadership Differentiation
Cost focus Differentiation focus
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Managing in Practice 3
Narrow target
Currently, Aurecon Singapore’s business strategy focusses on two levels of strategy for
its services products. First is differentiation through high cost and high value while the second is
broad market through provision of a wide range of services. Aurecon Singapore, provides a wide
range of services for example advisory, design, delivery and asset management services (Schatz,
2014). All this is done through the help of their highly trained and experience staff.
The two strategies have enabled Aurecon Singapore compete well in a competitive
environment. Through its richness of expertise, it has been able to provide services to the high-
end market through its high-value product which attracts a high cost. The excellence of Aurecon
Singapore has also been achieved through engaging in a wide market range hence fetching
profits from different channels (Bird, 2017). The two strategies are perfect although sometimes a
very wide range of products and markets may lead to confusion. Instead of further diversifying
or increasing its product range, the next best move can be to adopt another strategy which does
not collide with its current one.
The adopted strategy must be in line with its vision which is “Innovative & provides
high-quality services”. Having this in mind the suggestion is maintaining its differentiation
strategy but now focus on “lower cost”. Since the organization has been concentrating on high
cost previously, it can now strive to also gain the low-end market share but maintain quality on
its broad market as its competitive scope (Powell et al, 2015). This can be achieved by engaging
in providing its services to small projects for example homes, infrastructure, renovations et
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Managing in Practice 4
cetera. Although the profit per product is less, the market size is big. There is a rising demand for
better homes in nowadays on which Aurecon Singapore can take advantage of.
Corporate Level Strategy
Ansoff Matrix diagram can be used to explain Aerocon Singapore’s corporate level
strategy for its services and is as shown below.
Products/ Services
Existing New
Markets
Existing
Market penetration New products
And services
New
Cost focus Conglomerate
diversification
The focus here is on its existing market. Having this in mind, the analysis from the above
diagram shows that it can either improve through market penetration or through innovation
directed towards developing new products or services. Market penetration can be enabled by
executing initiatives that lead to increasing the market share.
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Managing in Practice 5
As suggested earlier, differentiation through low cost but quality business strategy can
help in enhancing the market penetration strategy. If Aurecon Singapore changes its focus from
corporate markets only but focus also on individuals and low-end investors, then it is possible to
increase the market share (Foreign Aff, 2015). The main advantage of the combination of the
two strategies is that they do not require much research and capitalization. This is because
Aurecon Singapore has been in this market for a long time and has the capitalization required
hence do not require to invest more towards this.
Penetrating on an existing market is much easier than penetrating in a new market. Some
of the favoring conditions are that there is no need for much marketing and promotion which
proves to be costly and time-consuming are less. Aurecon can also take advantage of the contacts
with the existing customers. Some of the contacts which are the employees of their existing
clients can provide a new market since they are already aware of the quality of Aurecon
products. Since residential houses market is increasing, these client’s employee may be in need
of building their homes and can be easier to approach when implementing this strategy. This is
because individuals do not have much money to spend although they still demand quality (Davis,
2017). The increased demand for Engineering consulting services gives confidence for this
strategy. Aurecon should, therefore, be consolidating all the service and allocate resources to
meet this demand.
Innovation
In its to increase its market share in its existing market, Aerocon Singapore needs to
engage in innovation of new services. To acquire the desired outcome which is to acquire more
market share, Aurecon must decide on how to implement this strategy (market penetration
supported by differentiation on the low market but maintaining the high quality) effectively. This
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Managing in Practice 6
can be determined by analyzing the current organization position and design the path to achieve
the desired outcome. Market analysis is of great importance in this area. SWOT analysis done
shows that there is an opportunity presented by increased demand for engineering consulting
services while the key threat is lack of engineering talents (Johnson, 2016). This means that we
need to devise ways to increase staff output without stretching the human power a fact that calls
for a technology upgrade.
In today’s world, innovation is at its highest in the sense that better and more efficient
equipment and machinery are being made every now and then. There is also a demand for better
designs and high quality which are enabled by improved technologies. For Aurecon Singapore,
to be able to implement this strategy effectively, they have to take advantage of his technology-
push market. This shall help in compensating for few engineers and also help them come up with
better products at a low cost. The increased demand for consulting services which is a market
pull calls for high output. With this knowledge Aurecon Singapore can meet the increased
demand for better products whose production cost is low through innovation. When the
organization has advanced technology, they can design products which are unique and push them
to the market which is the market pull. The increased demand shall quicken the achievement of
increased market share objective (Tomczak T., 2018). Since Aurecon Singapore’s vision is
“Innovative & provide high-quality services” better equipment shall help the staff to be more
creative and which shall lead to innovating for better, unique and high-quality products. Such
products shall always attract client and also help improve an entity’s image.
References
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Managing in Practice 7
Aff, F., 2015. focus on corporate markets alone but also on individuals and low-end investors,
then it is possible to increase the market share. Heinonlin, p. 69.
Bird, S., 2017. Knowledge Transfer Between R&D Projects and Commercial Projects: A
Conceptual Framework. Singapore: Springer.
Davis, G. F., 2017. Can an Economy Survive Without Corporations? Technology and Robust
Organizational Alternatives. Academy of Management Perspectives, Vol. 30(No. 2), p. 30.
Johnson, G., 2016. Exploring Strategy: Text and Cases. Chicago: Pearson Education .
Powell et al, 2015. A refined compilation of implementation strategies: results from the Expert
Recommendations for Implementing Change (ERIC) project. Implementation Science, Volume
2015, pp. 10-21.
Schatz, F., 2014. Goodwood Residence. Architecture Australia , Volume 103(Issue 3), pp. 92-
99.
Tomczak T., Reinecke S., Kuss A., 2018. Introduction. In: Strategic Marketing. Wiesbaden:
Springer Gabler.
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