Strategic Development of XXX Oil: Analysis and Recommendations Report

This report provides a detailed strategic analysis of XXX Oil, an Irish oil marketing company facing challenges like falling revenue and market competition. The report examines the company's current market position and proposes various strategies to improve business returns across its Direct to Customer (DTC), retail, and wholesale divisions. Key strategies discussed include aggressive marketing initiatives, open innovation, restructuring investment options, plant and machinery upgrades, technological advancements, and employee empowerment. The report emphasizes the importance of marketing to boost revenue, open innovation to enhance product lines, and technological advancements to improve operational efficiency. It also stresses the need for employee training and empowerment to drive market success. The analysis incorporates feedback and learning mechanisms to continuously monitor and improve the implementation of these strategies, ultimately aiming for financial sustainability and market leadership. The report also discusses financial strategies like acquisition and mergers and market development for existing products to earn more ROI. Continuous monitoring of the above strategies and feedback from stakeholders like apex management, employees, consultants, customers, government and competitors are also discussed.

Running head: STRATEGIC DEVELOPMENT OF BUSINESS
Strategic Development of Business
Name of the Student:
Name of the University:
Author Note:

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STRATEGIC DEVELOPMENT OF BUSINESS
Executive Summary:
Middle level firms often suffer from strategic market challenges like falling revenue
generations, sustainability challenges and challenges to introduce new products. They are
often within a narrow market segment which creates volatile demands for their products and
thus, does not guarantee long term revenue generation. These firms often suffer from weak
marketing strategies which are mostly used to avoid market competition and not to take
advantage of it. These firms require making crucial strategies to counteract these market
challenges and increase their earnings. The paper would study discuss these market
challenges and strategies which can be taken taking XXX Oil, a Irish oil marketing company
as the example based on the case study. The study would explore various methods like
foreign expansion and open innovation and how the firm can use them to deal with the
challenges.

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Table of Contents
Introduction:...............................................................................................................................3
Marketing of products:...........................................................................................................3
Open innovation:....................................................................................................................5
Strengthening organic market:...................................................................................................5
Restructuring of investment options:.....................................................................................6
Restructuring plants and machinery:......................................................................................6
Technological advancements:................................................................................................7
Empowerment of employees and training:............................................................................8
Financial strategies of XXX:......................................................................................................9
Acquisition and mergers:.......................................................................................................9
Market development for existing products to earn more ROI:............................................10
Continuous monitor the above strategies and feedback of stakeholders:............................10
Apex management:...............................................................................................................12
Employees:...........................................................................................................................12
Consultants:..........................................................................................................................13
Customers:............................................................................................................................13
Government:.........................................................................................................................13
Competitors:.........................................................................................................................13
Conclusion:..............................................................................................................................14

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Introduction:
The main strategic challenges organisations face today are falling profits,
sustainability challenges and the need to strengthen the market position which is in turn
limited by the limited resources. These challenges are more prevalent among the small and
medium sized companies which are under continuous threats from the large multinational
companies. The paper would delve into these three challenges against the backdrop of the
given case study. The assignment would analyse the issues faced by XXX Oil company
according to the case study and seek to propose ways which the company can take to improve
the business returns in its three division namely, Direct to customers (DTC), retail and
wholesale. The assignment would point out how one strategy would lead to the other and
they would together help XXX to strengthen its market position and gain sustainability. The
strategies are divided into processes, contents and feedback and learnings from the processes.
The blue sections would signify processes, green the contents and orange the feedbacks and
learnings, which would also include the business gains of the firm by adoption of the
processes.
Strategies of XXX Oil to increase its market leadership and achieve sustainability:
The above case study shows that XXX Oil aims to enhance its market leadership and
achieve sustainability by both financially and environmentally. The company can adopt the
following strategies to achieve this aim:
Marketing of products:
The first strategic process decision which firm can take is to form an aggressive
marketing initiatives boost the demand for the DTC products among customers and
consequent revenue generation. The case study mentions that XXX is not sustainable and
aims to gain sustainability in the next three years which forms the first strategic

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challenge facing the firm. The oil firm must use marketing process as a powerful tool to
gain sustainability, both financially and environmentally. The process should involve
aggressive promotion of its existing products on the written media like industrial magazines
and digital media. The content of the advertisements should consist of the salient features
and market advantages of XXX which the suppliers and the customers can take advantage of
by conducting business with the firm. The case study clearly shows that the volume of oil
products fell by 17 percent and the earnings before interest, taxes, depreciation and
amortisation (EBITDA) fell by 65 percent. The demand for the products were stemming from
building construction and home heating market. This shows that the market of DTC products
was very narrow and not sufficient to generate revenue for the firm to gain sustainability in
the next three years. Thus, the first strategic initiative which XXX can take to pave way to
attain financial sustainability and market leadership is marketing its products.
The firm in order to counteract the impact of recession and reducing EBITDA should
expand its market in industries like automobile industry which consume oil in large volumes.
This would boost its revenue generation which it can use to grow in organic market. This
would help the company supplement operational efficiency and online presence to gain
sustainability in the market, thus retaliating the second challenge the firm is facing.
The third challenge is to increase capital investment to hold on to the present
market position, though it very weak. It is clear from the point of view of the company that
the present market size and revenue generation are not sufficient to meet the third challenge
and inject capital. This once again points out that the company should use marketing as a
strategic tool to boost its revenue generation which it can channelize towards strengthening
its market position. The feedback and learning from the process of marketing which XXX
can gain is that it can come to know about new demands and preferences of customers. The

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firm can learn from the feedback from its marketing activities about new business
opportunities like start-up companies with whom it can partner with to expand its business.
Open innovation:
XXX Oil Company should enter into the process of open innovation to strengthen its
line of products and ultimately its DTC line of business (LOB). The case study points out to
the weak position of the oil firm. The firm must enter into open innovation with other oil
firms to generate better oil products to the customers. The fall in EBTDA clearly shows that
dwindling revenue generation of the firm before its competitors. The content of the process
would be XXX entering into open innovation either with other oil companies in Ireland or
with firms from different industries. Entering into open innovation would allow the firm to
get access to the resources like knowledge and markets which other firms possess. The firm
in the initial can exploit the resources of the partner firms to bring about improved products
for its DTC LOB and create its new customer base. Then as it gains strength due this
expanding market and resultant generation of revenue, it can break away from its partner and
introduce its own line of products using the knowledge it has gained from the partnership.
This improved product strategy would in fact, strengthen its marketing objectives as it would
the firm to market its products. Thus, feedback from open innovation consisting of new cost-
effective operation methods can help the firm to revive its weakening market position and
revenue generation. In fact, XXX Oil should learn to combine open innovation and marketing
to release new versions of existing products in the market to attract new customer base and
strengthen its market position.
Strengthening organic market:
The following are the strategies which XXX Oil can use to strengthen its organic
market:

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Restructuring of investment options:
XXX can restructure its investment processes and strategies to boost its return on
investments. The ROI revival process can consist of the firm use its expansion strategies to
enter new market and invest in new asset classes within Ireland. For example, the process can
consist of investing in other currencies would allow the firm to diversify the loss it would
suffer by fall in value of Irish pounds. The firm as a part of content of its new investment
policies can look forward to enter new markets with improved versions of its existing
products. The firm can enter derivatives markets and invest judiciously to earn maximum
ROI. The firm can enter oil hedging markets to obtain oil at lower prices and sell it at higher
prices to gain maximum profit on its hedging. As a feedback from this investment strategy,
XXX should be gain information about new emerging asset classes where it can channelize
its financial capital to maximise its returns on investments.
Restructuring plants and machinery:
The next strategic process of XXX Oil firm should take to gain sustainability,
increase its operational effectiveness and revenue generation is restructuring of plants and
machinery. The case study clearly shows that sustainability is of utmost importance for the
oil firm to operate more efficiently. The content of the new strategic process of the firm
should consist of channelizing a portion of revenue it would generate from investment
strategies towards acquiring modern plant and machinery which are capable of operating by
using less fuel. These new pieces of machinery should be able to process and produce more
products say, producing more packages of oil. The feedback from this strategy would
increase the operational efficiency of the firm manifold which would enable it to serve more
DTC, suppliers and wholesalers. This would help the firm to boost its Irish business
operations and simultaneously generate revenue from its foreign market operations. The
company should in fact shift towards production of oil as a part of its restructuring plant and

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machinery strategies. This would end the dependency of the firm on the other oil
manufacturing firms for its products and would be able to distribute its own products. Thus,
with its expertise it distribution and newly gained production capacity, the firm would be able
to increase its revenue generation and become more self-sufficient. Thus, investing in new
plant and machinery would enable the firm to become sustainable and operate more
efficiently. The firm would in fact, be able to align its production and distribution businesses
of oil products, thus, increasing its efficiency.
Technological advancements:
Technological advancement is the third strategy which the firm can adopt to
strengthen its organic product market. The above discussions recognise five strategies
namely, marketing, open innovation, advancement of plant and machinery and starting
its own production. The appropriate strategic process would require open innovation not
only in terms of existing products (as already discussed) but also in terms of new organic
products which it wants to strengthen. Moreover, the Irish business process would require the
firm to coordinate between new and old Irish business units. Producing organic fuel would
require the firm to continue research and development (R&D) with the firms leading the
market. Adopting new plant and machinery would also play a role in its organic products line
expansion which means that the firm requires maintaining steady communication with the
machine suppliers. This means that the firm should adopt an advanced communication to be
able to coordinate with these increasing markets and business partners like modern machinery
suppliers. Advanced communication systems like cloud would allow the apex management
and the middle level managers share information with other firms especially the ones
operating in organic fuel market. The feedback and learning from this process would be
better integration of its business operations in Ireland with its foreign business operations and
existing inorganic product line with its new product line, thus gaining operational efficiency.

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This shows that adoption of modern operations like modern machinery would help the
company gain operational efficiency.
Empowerment of employees and training:
The previous strategies clearly point out towards the fourth strategy which XXX Oil
must adopt to boost its operational efficiency and gain sustainability. The case study remains
silent about the employee conditions or performances. However, one can easily interpret the
poor organisational performance and falling earnings as result of low efficiency of
employees. The apex management of XXX should consider empowerment processes of its
employees as a way to its market success and train them to operate in the modern systems.
The empowerment process should contain training and mentoring highly performing
employees to handle more business responsibilities. The content of the empowerment
process should consist of technical training, business training and product training. The
business training should further be divided into communication sharpening training,
leadership training and customer relationship training. The apex management should
empower employees to take decisions and impart them with required knowledge and skills.
Moreover, the firm’s employee empowerment activities should also contain training its
employees to produce the new organic products by operating the machineries. The firm must
align the employees with the newly suggested strategies like adoption of advanced modus
operandi. The feedback from the empowerment strategy should be that the employees should
developing learning and skills to handle modern machineries. The employees should be
trained to operate on modern machineries and modern communication system. These
employees would learn and apply new techniques, skills and competencies to manage the
extended business of the firm within Ireland. Thus, the feedback from training and
empowering process of employees would be employees gaining more efficiency to operate by
using its extended decision making system. It can also be stated that not empowering new

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employees to take decisions would strain the existing decision making machinery of the firm,
thus impeding successful and long term adoption of the strategies discussed previously.
Financial strategies of XXX:
The following are the financial strategies which XXX Oil can adopt to boost its
operations, strengthen sustainability and catapult its revenue generation:
Acquisition and mergers:
The first financial strategic process which XXX can adopt is acquisition and mergers
in Ireland. The case study points out that the apex management already eyes acquisition and
merger strategy as a solution to the firms falling ROI and market position. However, the
stagnant market of Ireland prevents the firm from adoption of the strategy. It is clear from the
above discussion that the successful adoption of the above strategies would boost the revenue
generation of the firm. Thus, it can counteract the existing stagnant market and channelize the
newly earned revenue towards acquiring firms from different industries. The firm in fact, to
strengthen its organic product can acquire firms already in the organic fuel market. The
feedback from the acquisition process would increase in the knowledge base of XXX since it
would be able to utilise the market expertise of its subsidiaries to boost its own production,
thus generating more revenue and increasing its ROI. The firm can use the newly acquired
knowledge to outsource its allied business activities like packaging of products to these firms
and concentrate more on manufacturing of organic and inorganic oil and marketing them in
Ireland. Thus, acquisition and merger would not only help XXX to strengthen its organic
product line but also diversify its allied business and concentrate more its new core business,
manufacturing. Thus, it would become operationally more efficient, profitable and
sustainable. The management would be able to learn and enter new industries which can
emerge into revenue earning segments in the future.

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Market development for existing products to earn more ROI:
The next financial strategic process which the XXX can adopt to strengthen its ROI
and revenue generation is market development by focusing on developing new versions of its
existing products. The case study shows clearly that the market is limited to building
construction and domestic home heating markets. The demand for oil in the construction
companies vary according to the number of ongoing construction projects whereas among the
home heating customers, the demand rises in the winter and falls in the summer. It is clear
that the company cannot rely on these two markets solely to strengthen its revenue
generation. Moreover, its new organic products are in introduction stage which means, they
are not capable of generation huge revenue to ensure the firm’s sustainability. The content of
the product development process of the firm would be to recognise new market segments
with its existing products within Ireland. The new customers segments can be markets like
industrial heating market which use heating to carry out their manufacturing activities. The
feedback from these new markets would help XXX to develop its existing products further to
serve newer market segments. These new markets would generate continuous revenue for
XXX Oil firm on hand and mitigate the losses the firm suffers due to fall in demand in its
existing markets on the other hand, thus providing it with strong revenue base. Moreover,
serving an expanding base of customer segments would boost the goodwill of the firm and
help it attract investments. Thus, this strategy would render it financial strength and
sustainability.
Continuous monitor the above strategies and feedback of stakeholders:
XXX Oil firm should monitor the above mentioned strategies and their outcomes on
regular basis to ensure that they are appropriate and enable the firm to meet its strategic
challenges. For example, positive customer ratings for particular products would indicate the
products are capable of attracting huge revenue and the firm can also introduce these products

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in the new market to generate high initial return. Again, low rating for a product would direct
the company to carry on open innovation to improve the product. Dwindling numbers of stars
for a particular product would indicate that the firm should either reintroduce the products in
new forms or withdraw them from the market and introduce new products. Both these
strategies would require open innovation and marketing support. Thus, review of the
strategies and their outcomes based on customer parameters like customer ratings would
enable XXX to restructure its initial market strategies. Again, feedbacks from investors
would enable to gain information about their expectations like dividends and returns from it.
Thus, once again it can be pointed out that the firm can use feedbacks from stakeholders like
investors and customers to restructure its strategies in crucial areas like marketing and
finance. This continuous stakeholder support and restructuring of business strategies would
enable the firm to adapt to newly emerging market conditions and take advantage of them.
This would enable the firm to boost its ROI and gain sustainability in the market.
Table of strategies, objectives and their expected outcomes:
Strategies Objectives Expected outcomes
Marketing Entering new customer bases Generation of more revenues,
gaining competitive advantage
Open innovation Introduction of new products and
improved versions of existing products
New market penetration within
Ireland.
Restructuring of
investment options
More ROI Financial strength and
diversification of business risks.
Restructuring plants
and machineries
More productivity Enhanced revenue generation
Technological
advancements
Integration of business operations Enhanced communication and
better decision making.