Consultancy Report: Strategic Proposals for RocSearch - Feb 2019

This consultancy report provides a strategic analysis and proposals for RocSearch, an artificial intelligence services provider. The report begins with an introduction to entrepreneurial strategies and the impact of external factors like Brexit. It then analyzes RocSearch's current situation using the BCG matrix, PESTLE analysis, and TOWS matrix. The report recommends a Blue Ocean strategy and explores cost leadership and differentiation strategies. The situational analysis includes organizational objectives for customer base, service quality, revenue, and workforce expansion. The report concludes with a discussion of subsequent strategy implementation, focusing on long-term goals and strategic plans for RocSearch. The report emphasizes the importance of adapting to changes and improving employee capabilities to achieve the company's objectives.

MKT3031 Entrepreneurial Strategy
Consultancy report containing strategic proposals to the Managing Director of RocSearch
02 February 2019
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TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
CONCLUSION................................................................................................................................9
JUSTIFICATION..........................................................................................................................10
RECOMMENDATIONS...............................................................................................................10
REFERENCES .............................................................................................................................12
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INTRODUCTION
The strategic development of each company is an important element of entrepreneurship.
How can one briefly say what a strategy is? This is the aim and the goal is to stay in business.
One strategy for all companies does not exist. Each SME is unique in its own way, therefore the
process of developing a strategy for each company is different, since depends on the position of
the organization on the market, the dynamics of its development, its potential, the behaviour of
competitors, the characteristics of the goods it produces or the services provided, the state of the
economy, the cultural environment, etc. (C. White, 2004). For each company seeking to gain an
advantage, it is important to be able to respond in a timely manner to the demands of emerging
markets. However, the transformation of external relations is inseparable from changes in the
internal structure of the company. Therefore, when company decide to change the external life of
company, they will also have to change the internal life. (Bush, 2016)
ENTREPRENEURIAL STRATEGIES
A range of entrepreneurial strategies which SMEs can use to develop or consolidate their
situation.
The peculiarity of these days is that the UK’s withdrawal from the EU Brexit makes it
necessary to take a fresh look at the importance of forecasting in strategic management.
According to Alexander Lipovec (2016) industrialists are convinced that Brexit will have
a greater impact on business next year. Some of the executives of the surveyed companies do not
hide the fact that risks and losses due to Brexit may require extreme measures to reduce the
number of employees or their employment. Therefore, any policy decisions can significantly
reduce the chances of successful competition in the business market.(D.Hsu, 2018)
Without a contract, Brexit will harm not only Britain but also many European Union companies,
as new rules and borders will create barriers to the free movement of goods. (BBC, 2019)
BCG matrix is used to evaluate business strategy position. This matrix is divided into
groups according to factors (David, 2017):
 Dogs indicate slow growth and low market share or are mature on the global or national
market. (Kipnis and Broderick, 2017)
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 Money cows usually support business activities by financing administrative costs and
generating more money than consuming.
 Stars are the largest market share.
 Question Marks may initially lose money but have great growth potential but may be
considered by investment.
PESTLE analysis, sometimes referred to as a PEST Analysis, is a useful tool for
understanding the industry situation as a whole, and is often used in conjunction with a SWOT
analysis to assess the situation of an individual business.
It also makes a decision on how and in which way to enter new markets most quickly.
When it comes to a developing country, a new market takes into account franchising, which
could be an alternative and considered as the chosen strategy. Focus strategy takes the company,
under this strategy is required to target a narrow market segment like larger B2B customers that
require a constant need of the IT solutions at their workplace. The company is then, required to
attempt either differentiation or cost leadership strategy for that particular segment (Wicket et al.
2015). Rachreub IT Solutions Ltd has both well reputation and diversification in the service
range which helps the company in maintaining a competitive edge over the other companies.
The most recommended strategy for the company is Blue Ocean. It helps to overshadow
competitors. The market is coming new product or upgraded old. The company is a leader and
can hold a long time in the marketplace. Because reducing the costs of joint operations is in the
company's interest. The company collects competitive information. It analyses processes and
methods used by competing competitors. Business consultants do research and make
adjustments.
According to the five Porter's forces analysis developed, encourages entrepreneurs to
shape business practices and academic thinking today. Analyse measure industries that are
successful in the marketplace, attractive and have an impact on industry competition. Five
Porter's forces - vertical competition shows the bargaining power of customers and the
bargaining power of suppliers. Horizontal competition forces include the threat of new entrants,
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the threat of substitute products, the threat of established competitors and the threat of new
entrants.
Background of the chosen company: RocSearch
RocSearch provides artificial intelligence services to other companies and it has a long
and solid experience in the industry. RocSearch started in 1999 as a boutique research firm with
offices in UK and India. It employs specialists / consultants in various fields, statistics and
programmers. Russel Fischer is the chief executive officer of RocSearch.
The company ensures consistency and quality, takes the right challenges and
opportunities, and responds to various impacts around the world. RocSearch enables its
customers to win profitable transactions, market information, and consumer trends for their
customers. The company is orchestrated and researched. The company provides the highest
quality services creating solutions for customer business needs. RocSearch is always ready to
help its customers make strategic business decisions.
Subsequent strategy implementation in RocSearch
The main idea behind strategy development is to find the most appropriate way to
achieve the best results and increase your overall value. Value is not just a profit. It is
understandable that increasing profits is the most important goal of all entrepreneurs, mainly in
the sense of their existence. But the organization is a combination of different goals and interests.
Even the main influencing groups have different interests. The organization's activities are
focused on meeting the interests of clients and providing a full range of quality related services.
SITUATIONAL ANALYSIS
BCG matrix
The strategies for venture formation and business growth are one of the issues that are observed
and evaluated by managerial heads of an organization. It has been stated that in relation to
evaluate and analyse the growth prospects and venture formation in the market, and it is
necessary to analyse the business position and ranking in the market. Therefore, BCG matrix has
been used by management of the organization in relation to understand and evaluate the
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positioning and ranking of RocSearch in UK (David, 2017). The development of BCG matrix
includes observation of 4 major dimensions within which the business usually operates.
The growth-share matrix or BCG matrix also helps the business entities to evaluate and
analyse the product lines. In the model, the scattered graph presents the positioning of business
organization base n the market share and industry growth rate. The cash cow presents to those
companies which has a high market share in slow developing or growing industry. In another
dimension, dogs dictate low market share in the industry which is growing slow or has matured
status in the global or national market (Kipnis and Broderick, 2017). The companies which are
operating in the fastest growing market or industry with low market share are observed as wild
cats or question mark. In the matrix the last dimension talks about companies which are
operating in the fast-growing market with huge market share, they are called as stars. The stars
are usually the giant multinational companies which enjoy higher market share. In case of
RocSearch, the small scale company has low market share in highly demanded IT industry, thus
it can be observed as question market company as per the matrix.
In order to predict the future path of the company, it is necessary to constantly be aware
of all the innovations in the industry, constantly analyse all these innovations, choose the most
promising areas, introduce new products and services, familiarize them with their potential
customers. This is necessary so that potential customers are ready for new company services.
Technological, political, social factors enable SME RocSearch, which it is able to realize, if it
uses its capabilities and strengths, and also works to strengthen its weaknesses. RocSearch has
yet to assess its strengths and weaknesses in order to timely advise its customers. The basic
principles of the company apply to all types of world markets.
RocSearch, which has its own subsidiaries in the UK, USA, India, South Africa, Austria and
Hong Kong, has full access to the accumulated knowledge and highly qualified personnel. After
evaluation of RocSearch companies need to provide strategic step into the business expansion to
other countries.
Cost leadership strategy
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RocSearch should be looking to become the lowest cost IT solutions and service provider
in the country. As compared with its main competitor, Rachreub IT Solutions Ltd., the company
which is the cost leader in the market and is unchallenged in this position, the company requires
to focus on the broad market. The company should be looking to implement an effective cost
leadership strategy to meet with the demands of the price sensitive customers.
Differentiation strategy
RocSearch should be looking to diversify its line of services from the artificial
intelligence solutions services to the latest technological developments like DevOps and cloud
consulting as well like its competitor, Rachreub IT Solutions Ltd which is already working with
diversified services (Pujal,2015). However, the differentiation strategy requires the management
of the company to be flair in strong marketing and researching abilities.
RocSearch TOWS Analysis
Based on the PESTLE analysis and taking into account the SWOT, you can discuss the TOWS
matrix for RocSearch and develop strategic plans.
Strength-Opportunities:
A company has accumulated a lot of research information and can develop plans that
strengthen the company's strengths to take advantage of opportunities. Collected ideas can feed
into new markets, improve quality of services, and reduce service prices. After external threats
and opportunities are compared with internal forces and weaknesses, the RocSearch can
determine the strategy that it will follow.(RocSearch,2019)
Weaknesses - Opportunities:
During the impact of Brexit, RocSearch may lose some of the customer's order in the UK
but with a large, experienced and strong professional network, it can transfer its services and
staff to other units or even open new offices.
Strengths- Threats:
RocSearch has good recommendations in five countries, and also has advanced
technology. High-skilled workers may be relocated to other units as needed to continue to work
because they lose customers and at the same time lose educated high-quality employees.
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Weaknesses-Threats:
In order to tackle negative effects of Brexit such that one of their main threat i.e. to lose
large amount of their customer base and lose skilled workforce or employees, they can relocate
their office as well as employees. This will help them to retain their customer base and will not
lose skilled employees.
ORGANIZATIONAL OBJECTIVES
RocSearch has various objectives that they need to fulfil. Time frame for each objective
is fixed, some of them are will be achieved within a short duration of time and some of them will
be long term objectives.
1. Need to increase customer base at least by 10 percent by the end of 2020.
2. Make a strategic plan to increase the number of quality related services provided to
clients in terms of Analytics, research and Solution within next 5 years.
3. Increase overall revenue of the company at least by 20 percent by the end of financial
year 2019-20.
4. To increase number of employees within the organization and expand the workforce up
to 500 in next two years i.e. till year 2020.
SUBSEQUENT STRATEGY AND IMPLEMENTATION
The success of SME RocSearch depends on the right strategy. To do this RocSearch need
to constantly think about strategy objectives. It should be as :
1. Long-term goal to increase 10% customers by the end 2020.
2. Make a strategic plan for adapt to continuous changes by end of March 2019;
3. Send three of Human Resources Managers to courses every quarter of years for make
better use of the qualities and abilities of company employees.
The decisions to these objectives determine how top management of company is
committed to a strategy of solid decisions. The strategy of solid decisions determines the global
goal and directions for the development of company for X years. Planning begins with a clearly
defined strategy. Such planning allows the company to respond purposefully to events occurring
outside it, as well as to know the criteria for the success of its own development.
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A strategy consistent with RocSearch strategic and design an approach to implementing a
chosen strategy
The success of the RocSearch will now depend on many factors that are affected by
Brexit. Many small companies need to look for a new way to succeed in business.
The goal of the strategic planning process is to continuously analyse the organisation's
activities from both the present and the future point of view, and to anticipate strategic changes
to make the organization a successful future.
The development of RocSearch is a planned change of the organization, systematic efforts to
redesign the company in a way that helps to adapt to significant changes in the environment and
achieve new goals.
In order to stay in the market, RocSearch must think about new units or improve existing
ones.
The establishment of a new office means that the overall capacity of companies operating
in the sector is increasing. This can lead to lower prices or an increase in the cost structure of the
companies operating in the sector and their profitability. According to Porter, the following
major obstacles must be taken into account:
Economy of scale, which means that the unit cost of a service decreases as the volume of
services increases over time. Economies of scale are discouraging new market entrants, forcing
them to start large-scale production (this requires a lot of investment) or risking a retaliatory
blow to the incumbent companies. RocSearch should focus on quality of service rather than
quantity. This will help it avoid the mistake and test the customer's stability.
Service differentiation, which means that running RocSearch has recognized ratings and,
thanks to its marketing efforts or traditions, exploits customer loyalty to services. In order to
maintain such loyalty structures in the new unit, one must strive to maintain the same level of
loyalty.
RocSearch capital requirement for business expansion can be exploited by existing
resources, such as accumulated research, IT equipment, and existing employees who can train
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new employees locally. One-off costs may include additional training costs for staff, costs for
new production facilities.
RocSearch create a marketing entry plan for market participants for a newly opened department
based on a well-known company to help reduce costs and no increase service costs.
Competitive competition RocSearch reviews the number and strength of competitors, compares
service quality and prices.
If competition is intense, RocSearch can attract customers through price cuts and high-impact on
marketing. In addition, if there are many competitors in the market, RocSearch tries to offer its
customers deals in particularly favourable conditions.(because it is a firm firmly established in
the world market) Of course there are some competition is minimal and no one else does what
RocSearch does, then the company has great power and healthy profits. RocSearch has to choose
new places where a lot of business create and there is no or are small consulting agencies. If less
the competitors are on the market, the more support clients will get from RocSearch and
RocSearch position is stronger. At the same time high sales power will increase of RocSearch.
As you are talking about, RocSearch has a team of highly-qualified staff with research base and
high-quality equipment for ordering. This is a favourable position to stay in the market and
compete effectively.
RocSearch will be using BCG matrix situational analysis strategy to achieve and fulfil all
of their objectives they want to achieve within the specified time period. This matrix will be
helpful for the organization as it will help RocSearch to analyse their product or service portfolio
for their business. They will be able to understand which of the following services are used by
clients the most and has the largest market share, which of their service comes under cash cow or
is a money making service, which of their service has low growth market. This matrix will help
them to bring changes within their products or services as per the market demand in order to
increase their revenue, customer base.
CONCLUSION
The strategic management is vital for the success of small and medium entrepreneurs and
it is the key factor for providing long-term plans for the successful functioning of the business.
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The organisation’s understanding of the innovation, leadership, alliances, networking and the
importance of market analytical tool is creation for enhancing the sustainability in the business
model of the relative organization.
In summary, the strategy is an organization's management plan needed to achieve the
chosen goals and objectives. It provides the tools and techniques needed to achieve the
company's purpose and goals.
It is proposed to use the strategy of cooperation. This strategy is successfully implemented in the
so-called self-governing groups. To this end, a working environment is created that is conducive
to communication and interaction between the group’s employees. The interconnection of
workers is ensured in such a way that only with the contribution of each, can the work be
completed successfully. Staff training is provided that every team member knows how all the
work is done and how the activity of the SME RocSearch team is assessed.
So, the company's management needs to choose the right strategy, formulating the key principle
of gaining a competitive advantage - lower price, concentration in one area, diversification or the
combination of these strategic alternatives. Typically, one or more of the strategic alternatives is
needed to ensure maximum success. Regarding the choice of alternatives, unmanageable factors
have to be taken into account as they are the main part of the strategy implementation and affect
the end result. For example, one of the factors that may affect a decision is government-
authorized acts. Company managers cannot control this directly, but they are quite important and
need to be considered. Using a variety of prediction methods, you can determine which of the
several options you choose is best.
JUSTIFICATION
RocSearch provides artificial intelligence services to the small and medium
entrepreneurs. Hence, for RocSearch to remain sustainable in the market, it needs to target its
customer segment and focus on diversifying its service range in the process.
This context refers to how the company possesses the strategic management method in order to
grow their business in the market. First of all the company should follow strategic management
approach to grow their business and this also helps the company to make collaboration with
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other companies in term of providing artificial intelligence service. The company should also be
looking to collaborate with the companies and collects their information in term of providing
advice about how the companies can enable success and enhance their financial benefit in the
organization.
RECOMMENDATIONS
During Brexit period, RocSearch has a good opportunity to create a new unit in a strong
economy. The advantages of RocSearch are highly skilled employees, good equipment and
accumulated research results, enabling customers to make decisions quickly and correctly. That
is why RocSearch must look at which countries more new companies are registered and where
business companies need advice on internal and external interference. Also, keep high-skilled
workers moving from one unit to another unit. Improve technical tools to ensure customer
compliance. Gather information more carefully.
Strategic management approach is very important for the growth of the company. This approach
will help the company to work with other companies in terms of supplying artificial intelligence
service. Another useful recommendation is for the company to collaborate with others companies
regarding them providing advice and information about how they can achieve success and boost
the financial benefit.
In the present situation with Brexit, the business future is unpredictable. The managerial staff
should not and cannot really on journalists predictions, which do not have any solid or
reasonable base. Therefore, it is advisable for business to suspend their business implementations
until clear and fixed laws are passed. Because any risky and unsecure enterprises could impact
the business negatively or even make it collapse.
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