Strategic Management for Competitive Advantage: Global Cars Analysis

This report provides a comprehensive analysis of Global Cars Private Limited's strategic management approach to achieve competitive advantage. It examines the company's performance across four rounds, focusing on decision-making, forecasts, and results for each year. The report analyzes key performance indicators (KPIs) such as revenue, market share, and financial metrics, including sales, gross margin, and post-tax profit. It also delves into learning across various departments, including finance, marketing, operations, and human resource management. Furthermore, the report assesses team performance and provides personal reflections on the strategic decisions made. The analysis covers trend analysis, production, sales, and market share, providing a detailed understanding of Global Cars' strategic journey and achievements in the competitive car manufacturing industry.

Strategic Management
for Competitive
Advantage

Table of Contents
INTRODUCTION..........................................................................................................................1
Company performance.....................................................................................................................2
2.1 Round (Year)1...........................................................................................................................2
1.Decision making.......................................................................................................................2
2. Forecasts and results...............................................................................................................2
2.2 Round (Year) 2..........................................................................................................................3
1.Decision making.......................................................................................................................3
2. Forecasts and results...............................................................................................................4
2.3 Round (Year) 3..........................................................................................................................5
1.Decision making.......................................................................................................................5
2. Forecasts and results...............................................................................................................5
2.4 Round (Year) 4..........................................................................................................................6
1.Decision making.......................................................................................................................6
2. Forecasts and results...............................................................................................................7
2.5 Trend analysis............................................................................................................................8
1. Production...............................................................................................................................8
2. Sales........................................................................................................................................8
3. Gross margin.........................................................................................................................10
4. Unsold stock..........................................................................................................................11
5. Post tax profit and net cash position.....................................................................................12
6. Market share..........................................................................................................................13
3. Learning.....................................................................................................................................13
3.1 Finance................................................................................................................................13
3.2 Marketing............................................................................................................................14
3.3 Operations...........................................................................................................................15
3.4 Human resource management.............................................................................................16
4. Conclusion.................................................................................................................................17
5. Team performance.....................................................................................................................18
5.1 Performance of the team.....................................................................................................18

5.2 Personal reflection...............................................................................................................19
REFERENCES..............................................................................................................................20

INTRODUCTION
Business objectives are part of planning process that helps to achieve and accomplish
organisational wants over a specific period of time. Global cars private limited is a new emerging
car manufacturing organisation that provides affordable cars to general public. Business
objectives of Global cars is to increase revenue by 20% till end of the year and together with this
to acquire 5% market share in the year of launch (Ahmad, Bosua and Scheepers, 2014).
Providing quality cars at affordable price is considered as prime objective of business to survive
in long rum. Company is introducing new models of car to improve its performance and also to
attain its objects. Objective to increase revenue is attained by providing more variety in cars that
attracts large consumer group. Increase in consumers leads to more revenue and also market
share of Global cars will increase. Providing cars with more features, warranty and improved
quality will leads to attain overall objective of Global cars private limited. Four different types of
rounds are going to be conducted in this report in which actual performance of the company can
be analysed. From the last report it has been analysed that organisation is performing well in the
market and now it is willing to acquire large market share by launching new cars.
Aspects Objectives Status
Revenue  Increase the revenues by 20% till the end of
financial year.
 Limit the expenses in order to earn more profits.
 Increase the sales.
Undone
Done
Approached
Market share  Capture large market share by satisfying
customers.
 Cover 5% targeted market share in first year of
launch.
 Categorised market share on the basis of luxury
and medium cars.
Undone
Done
Approached
1

Quality  Enhance quality to attain more market share.
 Provide 3 years warranty to the customers.
 Provide service of the car in the best and quality
manner.
Done
Undone
Approached
From the above table it can be analysed that Global Cars Pvt. Ltd. has achieved most of
its objectives and some of them are approached which means going to be achieved in up coming
period. Expenses are reduced, 5 % market share is also been captured in the first year of launch
and quality of the cars is also enhanced. All of them are achieved by the organisation so that
large market share can be captured (Armstrong and Taylor, 2014).
Round (Year) Total sales
(£m)
Total unsold
stock (£m)
Shareholder
fund (£m)
Closing bank
balance (£m)
Outstanding
loan (£m)
Round 1 5941 0 -3334 3006 180
Round 2 4498 0 -4262 2887 180
Round 3 7085 0 -2454 2589 180
Round 4 6553 0 -1478 2148 180
From the above table it has been analysed that there is no unsold for the organisation.
Total sales for round one to four are £5941, £4498, £7085, £6553 respectively. The company is
not having sufficient shareholders funds and outstanding loan of £180. Closing balance at the
end of each round is £3006, £2887, £2589, £2148 respectively.
Company performance
2.1 Round (Year)1
1.Decision making
In the first segment the organisation is going to launch two new cars in the market that
are sports 19 and Brezza. The first car is a medium car which is sports 19 model and the another
car is of luxury nature which is Brezza. Targeted group for Sports 19 is below 40 and for other
car the targeted group is 40 to 60 years. The first model is having various features that make it
different from others. It includes extended warranty, face lift, improved build quality, 3/5 door
hatchback, glass roof, dynamic sound pack and fuel efficient engine. This car is mainly designed
2

for the millennials hence it has some attractive features for them. Brezza is also having various
features including anti theft system, luxury styling pack, rain and parking sensors (Chen, Delmas
and Lieberman, 2015).
Global Cars Private Limited needs to adopt appropriate promotional techniques because
both the cars are going to be offered to different segments of market. For the customers of below
40 the company can use online promotions, social media marketing and other latest techniques.
For the customers of 40 to 60 age group the marketers of the organisation can choose news
papers, television etc. for the promotions in order to aware individuals about the cars that are
going to be launched by the company in the market.
2. Forecasts and results
Subject to forecast, Global Cars Private Limited has forecasted that no car will be remain
unsold which means there would not be any unsold stock at the end of round one. The estimated
sales of the company is 1200 million pound and the resulted sales is 5941 which is very high as
compare to estimation. It has also been estimated that both the cars should have at least 1%
market share. Prices that are decided for both Brezza and Sport 19 are 2500 and 12000
respectively. Total Strike days are 2 that are forecasted by the organisation (Goetsch and Davis,
2014).
KPM Sport 19 Brezza Sport 19 Brezza
Type of KPM Prediction Result
Car size Medium Luxury medium Luxury
Age range of
customers Below 40 40-60 Below 40 40-60
Work force 652 1157 652 1157
Automation
allocation 25 0 25 0
productivity 75.92 73.475 75.92 78.383
Produced 49500 85000 49500 85000
Unsold stock 0 0 0 0
3

Price 12000 25000 12000 25000
Gross margin 22.3 26.82 22.3 26.82
Market share 1.05 1.75 1.56 2.9
Sales 1200 5941
Post tax profit -1500 -1157
Net cash position -1500 -1875
Strike day 2 2
2.2 Round (Year) 2
1.Decision making
In second year Global Cars Private Limited is going to launch a new car in the market.
Name of the car is Sports 2.0 which is a city car and the target market for this car is cost efficient
and the target customer for this new car are from the age group of 30 to 40. The car is having
various features as it will help to capture large market area (Hill, Jones and Schilling, 2014). It
has reverse sensing system, defogger, traction control, adjustable comforts, anti lock braking
system etc. All these features will help the organisation to capture higher market area by
attracting large number of customers. The workforce which is involved in the manufacturing
process of the new car Sports 2.0 is 1363 employees because it is a new car. Main goal of the
organisation for this product is to acquire larger market share in order to expand business. The
automation for the car is increased by the organisation because currently demand for the
automated cars is increasing continuously. Selling price which is decided for the new product is
17999.
2. Forecasts and results
According to the forecasted figures the estimated production of new Sport 2.0 was 64800
it has resulted in the production of 69129 cars because productivity of the cars in increased. No
unsold stock was forecasted by the company and and in actual there was no unsold units at the
end of the year. The organisation has started to earn profits from round two because the
production and the demand of the cars in increasing in the market. Global Cars Private Limited
has forecasted that 3200 million pound sales can be acquired by the company in year 2 and
4

resulted sales for the second year is 4498 which is decreased as compare to previous year. Strike
days that are forecasted by the executives of the company were 5 and the resulted strike days are
32 the reason for the strike is decreased salaries and compensations that are provided to the
employees (Hill, Jones and Schilling, 2015).
KPM Sport 19 Brezza Sports 2.0 Sport 19 Brezza
Sports
2.0
Type of KPM Prediction Result
Car size Medium Luxury City medium Luxury City
Age range of
customers Below 40 40-60 30-40 Below 40 40-60 30-40
Work force 756 1245 1363 756 1245 1363
Automation
allocation 25 0 50 25 0 50
productivity 76 74.5 60.78 77.3 79.85 64.84
Produced 49552 86185 64800 50400 92374 69129
Unsold stock 0 0 0 0 0 0
Price 14999 28999 17999 14999 28999 17999
Gross margin 30 30 30 38.42 37.51 31.45
Market share 2 2.5 1.42 2.1 2.9 1.42
Sales 3200 4498
Post tax profit 800 -1063.5
Net cash position 800 -852.6
Strike day 5 32
5

2.3 Round (Year) 3
1.Decision making
Form last years analysis it is estimated that the performance of Global Cars Ltd is improving
continuously compared to last year. There is a forecast made in term of managing the sales
records in terms of managing the sales records and variations for next year. It is expected that the
company would be able to consolidate the forecasted performance of Global Cars Ltd. It is
decided that company is going to introduced model of car named as Sports 1.5 for age group of
up to 25 years group. This year following improvements are made subject to predictions and the
analysis in terms of increasing sales records of organisation such as productivity level for Sport
19 world be 78%, productivity level for Breeza would be 76%, Sports 2.0 was analysed as 70%
and productivity level for Sports 1.5 would be 69.5% (Hill, 2017).
Results were recorded as follows that production for Sports 19 was recorded as 50856
units, production for Breeza was recorded as 88955 units for this year, Sports 2.0 will be able to
achieve the level of productivity with 74630 units and 65000 units for sports 1.5. Price of new
models also increased in the following manner such as, price of Sports 19 kept £19999, price for
Breeza cited up to £29999, Price for Sports 2.0 was cited at £26999 and price for Sports 1.5 was
cited at £21299. This analysis also helps to retain specific shares and rights of business in terms
of new product which is Sports 1.5. IT is evaluated that the production level get increased for
existing car models as Sports 19, Breeza, Sports 2.0 subsequently 2.56%, 1.46% and 1.75%. The
use of fractional changes analysed in context of determine the challenges and variations among
the sales and gross profit margin records. Gross profit margin was calculated as 40% for Sports
19, Breeza 30% and Sports 2.0 was calculated as 30% and 50% for Sports 1.5. the variations
among the models also get changed with different fractional changes and variations.
2. Forecasts and results
The results presents positive results in terms of sales. It was predicted that company will
be able to sale £5000 million for this year but the results presents more better figures in terms of
sales. Sales for the year was recorded as £7085 million and the post tax profit was calculated as -
1771 which was predicted as 500. it is predicted that 4 strikes will be fall during the production
whereas only 3 sticks in acual fall upon organisation during a particular time span (Lasserre,
2017).
6

Models of cars
Sports
19
Breez
a
Sports
2.0
Sports
1.5
Sports
19 Breeza
Sports
2.0
Sports
1.5
Types of KPM Predictions Results
Car size
Mediu
m
Luxu
ry City City Medium
Luxur
y City City
Age range of
aimed customer
Below
40 40-60 30-40
Up to 25
years
Below
40 40-60 30-40
Up to 25
years
Workforce 652 1157 250 225 652 1157 250 225
Automation
allocation 25 0 50 50 25 0 50 50
Productivity 78 76 70 69.5 77.5 75.3 69.41 69.33
Produced 50856 88955 74630 65000 50856 88955 74630 65000
Unsold stock 0 0 0 0 0 0 0 0
Price 19999 29999 26999 21299 19999 29999 26999 21299
Gross margin 40 30 30 50 42.33 35 33.33 59.67
market share 2.5 3 2 1 2 3.2 1.5 0.05
Sales (£m) 5000 7085
Post tax profit 500 -1771
Net cash
position 500 -1200
Strike days 4 3
2.4 Round (Year) 4
1.Decision making
The decision making and analysis also considered with variations among different
variations and control. Results indicates towards positive sign respect to organised manner. As
per increasing trends of company it is evaluated that company is tracking the results of business
7

more strategic manner to implement the plans for better analysis. Company is seeking to
introduce another new product which is Luxury car model as V8 360X. This model is introduced
for age group of 25-30 years (Lazzarini, 2015).
2. Forecasts and results
As per the results shows that company would be able to achieve the sales target of £4000
million for this year after decocting the post tax profit. The results are found positive in such as
£6553 million for this year. Post tax profit was calculated as -1153 million. It was predicted that
organisation will have to face 2 strikes but in actual 3 strikes were faced by organisation with in
operations.
Models of cars
Sport
s 19 Breeza
Sport
s 2.0
Sport
s 1.5
V8
360X
Sports
19
Bree
za
Sport
s 2.0
Sports
1.5
V8
360X
Types of KPM Predictions Results
Car size
Medi
um
Luxur
y City City
Luxu
ry
Mediu
m
Lux
ury City City
Luxu
ry
Age range of
aimed customer
Below
40 40-60 30-40
Up to
25
years
25-30
years
Below
40
40-
60 30-40
Up to
25
years
25-30
years
Workforce 652 1157 250 225 325 652 1157 250 225 325
Automation
allocation 25 0 50 50 70 25 0 50 50 70
Productivity 80 77 75 72 50 79.5 75.3 74.5 71.5 50
Produced 52160 90125 79961 67338 5000
41467.
2
7165
0 63569 53534 3975
Unsold stock 0 0 0 0 0 0 0 0 0 0
Price 22999 32999 28999 25999 35999 22999
3299
9 28999 25999 35999
Gross margin 45 35 35 55 30 44.6 34.5 33.33 56.9 25
market share 3 3.5 2.5 1.2 1.5 2.5 3.4 2.5 1 1.4
8

Sales (£m) 4000 6553
Post tax profit 0 -1638
Net cash
position -500 -1153
Strike days 2 3
2.5 Trend analysis
1. Production
From the above chart it has been analysed that production of the cars was increasing
continuously in first two years because in this period the demand of the car was high and the
organisation has attained a higher sales. In last year the production was decreased as the
organisation has reduced the waste and unnecessary costs of the products in order to increase
profits and sales (Madsen and Walker, 2015).
2. Sales
9
Round 1 Round 2 Round 3 Round 4
0
50000
100000
150000
200000
250000
300000
49500 50400 50856 41467
85000 92374 88955
71650
69129 74630
63569
65000
53534
3975
V8 360X
Sports 1.5
Sports 2.0
Brezza
Sport 19