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Strategic Plan Report MINI Business 2010 Strategic Management & Business Policy Introduction Fitness industries are growing up and attracting huge number of companies to go through this business. Mini is one of these companies, which decided to enter the Australian market in order to start the fitness business as a branch of their main business. This report will explain how Mini active uses strategic management and applies its concepts and principles to enter a new market in order to create a clear base for its plans and vision.Moreover, the report presents a detailed analysis for Mini active environments.
Then, the business level strategy shows how to utilize these outcomes to provide the reader with a broad view about the market that Mini active intends to compete in. In addition, the results will present the appropriate strategic direction that can achieve the maximum level of success to the firm. Strategic management A strategic management is a set of tactics and steps that the organization follows to gain competitive advantages in order to achieve its goals.Therefore, Strategic management helps the company to seek future opportunities, to manage potential risks in the business environment and to search for any change in the market trends (Leavy, 2003). The purpose of strategic management is to help Mini active to draw a comprehensive map about the opportunities and the threats that it may face in order to create a flexible strategy and achieve the maximum goals (Ramos & Ruiz, 2004). Mini, the famous car brand owned by BMW group, wants to enter the fitness industry in Australia seeking investment opportunities starting fromMelbourne city with a future goal to expand later on.
Based on its success as an automotive brand, Mini has several advantages to utilize in order to create a strategy for success in getting to the fitness industry market. This strategy consists of various elements, which are Mini vision, concepts and mission. First, Mini’s vision is to become the leading fitness industry in Australia and its members’ satisfaction is on the top of its priorities.
Secondly, the concepts that Mini relies on are basically the following: Mini Active industry believes that providing fitness services with a high quality is a key element of success.Mini also wants to send a message to the Australians that Mini Active has features that represent youth, style and fun for its members. Thus, Mini’s mission is to prove to its members that Mini is more than just a fitness industry and the members always come first. Firms’ environments The general environment is a set of internal and external factors that affect directly or indirectly the organization’s capabilities and performances that maybe considered as threats or opportunities exploited by the management.As for the industry environment, it is a group of elements that have direct impact on the firm and its competitive decisions and actions (Schraeder, 2002). Moreover, the general environment is divided into two basic models, internal and external. The internal environment is concerned about the factors that occur within the organization including the human, the financial and the technological resources while the external environment is primarily focused on the conditions and the factors that surround the organization, which reveal the opportunities and the risks that it may encounter (Emden, Yaprak & Cavusgil, 2005).
Mini Active has found four attractive factors in the external environment that serve its objectives: The demographic factor shows that the population in Australia is estimated to be around 22 million people; 4 million of them live in Melbourne according to the Australian Bureau of statistics (2009). This indicates that Melbourne is a populated city with potential market opportunities that attract fitness industries among the other industries. The statistics estimate that 1. 7 million Australians use fitness center services and the population growth rate in Australia in 2009 was 1. 7% which is higher than the world average growth rate.This fact reflects an increasing need for fitness centers in Australia.
As for the economic factor, Australia’s economy grew for 17 consecutive years before the financial crisis and currently the Australian economy is recovering steadily and high expectations are predicted regarding the economy growth in the future years. Australia is known for its high-growth, low-inflation, low interest rate economy Thus, the financial status for Australians will make them able to sign up for fitness centers membership. Another factor is the important role that fitness centers play in reducing health care costs.Access economics report (2008) points out that Australia is ranked the fifth among the countries that have a high adult obesity rate, and fitness centers have a positive impact on improving the workforce productivity and reducing health problems.
Therefore, the Australian government support fitness industries and give them several advantages. The socio-cultural factor, according to the Economist Group, Melbourne is considered as one of the most livable cities due to its economical, social, and cultural position in Australia and the world. This important position is one of the key opportunities that Mini counts on.Melbourne is an attractive place for international students around the world.
The social and cultural environment also brings tourism to Victoria State. It is estimated that 1. 4 million international and 18. 2 million domestic visitors visited Melbourne in 2008 according to Melbourne enterprise (2010). This estimation indicates that there is an increase in the number of visitors who may seek fitness club membership while staying in Australia.
Threats and Risks: There are few threats and risks that Mini should take into consideration in order to increase the success of its strategy. First, threat of substitute s one of the biggest concerns for Mini active. Many residential buildings offer small gyms for their residents.
In addition, the weather in certain seasons during the year encourages people to workout outdoors and to enjoy sea sports on the beaches around Melbourne rather than joining fitness centers. Second, the customers have a Bargaining power to choose a wide range of fitness centers. Mini Active should study this factor carefully due to the various fitness centers that exist in Australia such as Fitness First, Genesis and Active fitness. The member can find different choices based on prices, locations and services.Mini Active will distinguish itself in services as well as facilities. Third, the intense competition among fitness industries in Australia is increasing in order to attract more customers and the strategies that they follow are various. Fitness first, for example, offers membership cost advantages and various locations as well as cardio programs designed specifically for weight loss purposes.
Mini Active has created a strategy that combines low costs in membership switching and it is called “Mini in prices & Maxi in value”. Mini active internal environment is divided into two categories, tangible and intangible resources.The tangible resources include financial, organizational and physical resources.
•Financial resource: Mini active has financial support from Mini Company to finish the projects of building fitness centers. Mini Active will be able to generate internal funds once the fitness centers start to operate. In addition, Mini active has a plan to get loans from the banks and Mini will facilitate this process due to its reputation. •Organizational resource: The organizational structure of Mini Active will be based on flat hierarchy, decentralized highly transparent and connected via internal networks.The primary goal for Mini active is to create flexible channels between the staff members and the top management in order to facilitate the communication and accelerate the level of actions. •Physical resources: Mini Active physical resources include buildings, sport equipment as well as computers and maintenance equipment. Mini active will also make sure that its employees are carefully trained and familiarized with the usage of the equipment and maintaining them.
The intangible resources that fit Mini active are human, innovation and reputational resources. Human resources: One of Mini’s goals is to hire staff members with high qualifications to share their knowledge and expertise. In addition, Mini Active is committed to train its employees and equip them with the required skills to take care of their members in and outside the fitness centers. •Innovation resources: Mini Active innovation is presented in the online services that offer member profile, which gives the members the opportunity to create their schedule, diet and other activities under the supervision of the trainers.Moreover, Mini will celebrate the achievements of their members when they achieve their goals as a kind of encouragement for them. •Reputational resources: Mini will use its successful brand name as an asset to attract the customers through the concept of “Mini in prices& Maxi in Value”. Also, it will use its logo as a guideline for Mini Active project.
Firm’s Capabilities: According to the external and the internal environment that are mentioned in detail about Mini active project, it is shown that there are three capabilities such as human resource, marketing and management capabilities.Firstly, Mini active has a human resource capability based on motivating its employees’ performance by conducting training programs and receiving feedbacks. In addition, Mini’s goal is to create flexible means of communication between the staff and the top management to ensure quick responses (Eisenhardt & Martin, 2000). Secondly, Mini active realizes that it has a good marketing capability based on TV, newspaper and Internet advertisement. Also, Mini active has a plan to sign up a marketing agreement with sportswear companies such as Nike and Adidas in order to provide its members with offers and discounts (Wang, & Lo, 2003).Finally, the management capability is one of Mini’s strengths.
Thus, Mini active will be led and managed by experienced, flexible and qualified managers who are able to take decisions regarding businesses forecast and opportunities (De Toni & Tonchia, 2003). Business level strategies Business level strategy BLS is a group of tactics and actions that are utilized to get an edge over the other competitors through exploiting certain opportunities in the market. The types of the BLS are cost leadership, differentiation, focused cost leadership, focused differentiation and integrated cost leadership or differentiation (Andrew, 2002).The suitable BLS type for Mini active is differentiation such as services, facilities, and membership advantages. So, Mini will provide its members with a complete set of services that combines performance monitoring and weekly consultation. Further, Mini Active will establish huge fitness centers that include many sport activities under one roof that suits people’s needs including disabled people, unlike many fitness centers that have small fitness centers.
These features are observed by Mini’s activity as a health club centre, which aligned with Mini’s vision to become a leader in the fitness industry.In addition, Mini’s membership gives its holder several features and special offers such as Mini products discounts. The other BLS types are not suitable because Mini active cannot compete with the other fitness centers in costs due to the huge facilities that Mini is planning to establish. In addition, the fitness industries in Australia have hectic price competition. Strategic direction The strategic idea for Mini Active is to provide its members with unique services and facilities.
Based on the firm’s environment analysis and BLS, the key components of Mini are facilities differentiation, gradual expansion and unique services.The firm’s external environment analysis has shown that Australia is an attractive place for fitness industries and the statistics have positive indication in relation to fitness centers projects. Further, the internal environment analysis has identified some special capabilities based on its resources. On the other hand, Mini active is aware of the threats and the competitive advantages that other fitness industries have in Australia such as low membership fees and the various locations that they offer.
Strategy FormulationIn order for Mini to translate its strategy into action, several procedures should be finished. First, finding good locations in the heart of Melbourne to establish Mini active center is a priority. Moreover, providing the fitness centers with the required equipment and building a complete network infrastructure inside each center. Strategy Implementation “The approaches to implement various strategies should be considered as the strategies are formulated” (Coulter, 2005). The company should consider how the strategies would be put into effect at the same time that they are being created.For example, while developing the human resources strategy involving employee training, things that must be considered include how the training will be delivered, when the training will take place, and how the cost of training will be covered (Martensson, 2000). In this phase, Mini active will use its tools and resources to achieve its plans.
These plans will include operating for 24/7 and during holidays, providing its members with discounts in the first 6 months to encourage them to join Mini membership and lunching a marketing strategy through advertisement. ConclusionThis report has shown that strategic management is essential due to its role in providing the firm with the required data and the analysis to gain competitive advantages in the market and perform successfully in the short and the long term and sustains this success. Furthermore, strategic management process enhances the managers to choose the appropriate decisions and procedures through the circumstances and the conditions that surround the market. References Andrew B. Nyaboga, 2002, Distributed Computing Systems, Structure And Strategy, The Review of Business Information Systems, vol 6, no.
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