This small business enterprise assignment given for HND Business Course in the Glyndŵr University, in this assignment a small business enterprise. Silverdoor chosen that deals in Apartments.
LO1 Investigating the performance of a selected small business enterprise
LO 1.1 Selection of a small business enterprise and identifying its strengths and weaknesses
Silverdoor serviced apartments is a small business enterprise headquartered in London. It is operating in more than 60 countries offering 70,000 serviced apartments and 300 cities for corporate clients for individual as well as group bookings. It is consistently growing in the UK and in other developing markets.
Strengths of the company
small business enterprise assignment
Employees are inspired every day from their senior employees as they live the firm’s values (B.co.uk, 2014). Employees have the habit of telling the truth always, and tend to deal with any issue by facing it rather than avoiding it. This makes the organisation more transparent. The existence in almost 60 countries gives it a sheer advantage of being one of the preferred choice of serviced apartment among corporates. The firm is geographically spread and is offering good competition with its brand building exercise through a country wide growth plan. Relocation is a major business that is gaining momentum and the firm is a pioneer in relocation service provider and it won the 2012-13 best property and solution provider award from Re:locate awards 2012-13 (Relocatemagazine.com, 2014).
The firm manages to offer a substantial work life balance to its employees as most of its employees feel that they don’t feel their health is suffering because of work, and most of them are receiving performance bonus and attendance bonus. This makes the company’s employees to have a more free working structure which in turn produces desired results.
Weaknesses of the company
The firm because of the serviced apartment industry is facing a challenge in keeping a constant brand recognition scenario, unlike hotels. Hotels are more in numbers and provide short stays which are more in demand than long stays serviced by serviced apartments. Other than in Europe, UK, US, the firm is not very well known in Asian countries where it has presence. This gives them reduced sales from the Asian region.The global distribution system of the serviced apartment industry is not fully developed to recognise individual serviced apartments and this causes errors in customers’ choice and preferences.
LO 1.2 Comparative measure of performance
The business has been steadily increasing its business and is successful to have remained in a low dent bracket. This has made it more attractive to external equity investors and institutional investors. The expansion is cautious as it is observing various factors affecting its business activities and operations in the home and other countries. It is better to undergo a SWOT analysis for finding out its complete performance measure.
1. Geographical reach and presence for better brand recognition
2. Offering best employee working business environment
3. Have the advantage of first mover in certain countries with low competition
1. The serviced apartment industry is not very much marketed and advertised.
2. Lack of a worldwide booking system which makes it appear less in searches
3. The demand of long stays being less keeps them a constant competitor to hotels
1. Move into new countries where apartment concept is not yet introduced but has demand
2. Capitalise on its brand recognition in known countries to capture new clients.
3. Provide innovative products to customers by making use of its low cost structure.
1. Increased competition from hotel companies own serviced apartment brands like Marriott Executive apartments, Doubletree apartments, etc. can snatch away its business.
2. Cheaper brands can likely overtake the business in times of recession and cost cutting.
3. Exceptional service offered by its competitors can simply decrease its business and clientele and thus profits.
LO 2 Proposed changes to improve management and business performance
LO 2.1 Recommendation of appropriate actions to overcome the identified the weaknesses in the business.
The firm must develop distinguished product categories in the industry to differentiate itself from its competitors to gain more market share. This can be done by offering extra services like free usage of small meeting rooms, free pick up and drop to airports, and charging nominal for a long haul stay. Private equity infusion can help the company in finances, getting expertise, and get quality inputs in its expansion plans. If possible, the company must invite a private equity partner who can invest in the business which can push its expansion exponentially in new markets (Vinturella and Erickson, 2013). It can then enter nascent markets and have the first mover advantage. Before entering a market, it must conduct a research of the demand matrix of the type of apartments desired, and then only invest in either one, two or three bedroom apartments according to the research results. Employees are the backbone of any organisation, and hence it must equip each employee with professional and employability skills like problem solving skills, negotiating skills, financial controlling skills, administrative skills, and excellent service deliverance skills, to make the team a force of able and talented ones who can deliberately act upon any situations on their own.It must also full proof itself with any potential threats of the future, and pre-plan for the effects that the threat may produce. It can hire a professional advisory firm to periodically take advice from them about their growth plans and the plan employed.
LO 2.2 Analysis of how the existing performance and standard can be maintained and strengthened
The firm has a substantial performance standard which is at par with its competitors, but over a long term this is not enough and with changing times and customer preferences, it also needs to change. The performance measure of each employee must be measured according to their potential and their delivery capabilities rather than their time input at work. Keeping a reward system has helped many organisations and thus a suitable reward system can be prepared and implemented into all divisions depending upon the performance criteria.A proper analysis of the current activities of the firm and its likeability among customers must be measured and extract maximum demand list from them to enhance its internal service standard (Baum, 2011).Assessments of financial health, skills development, and employee efficiency must be carried out to keep the team focussed and alert of their goals.A strong and single master data management must be developed to streamline the activity flow of employees and have more predictability in employee actions and results desired. In addition, developing a core principle of the organization and followed by each employee can actually reduce the number of disruptions that occur across all levels in the company. Sometimes, any company needs external environment expertise to be refreshed and renewed. Hiring external expertise of repute in the form of consultants, independent directors on the board can enhance the strategizing, decision making, and solving problems in the firm. The company must accept the changes in the market and be willing to change accordingly and deliver excellent service in a changing market place to retain regular customers. And lastly, it must also maintain excellent relations with the customers, suppliers, and advisors, to keep the firm on track and alert to external factors which may affect the firm.
LO 2.3 Recommendation of new areas into which the business can expand
The business can expand into travel services by leasing a fleet of cars and vehicles which could give them added revenues. This is because, they are into hospitality business and travel is a connected activity that their customers would use anyway.It can identify a narrowed group of targeted market and form products by customising it with the customers demand. For example, due to enhanced brand identification, the company can think of developing branded products which can be sold in their apartment projects to customers. They can also think of outsourcing catering service or facility management service for other properties because of their inherent expertise. The firm can think of entering branding and management consultation for other upcoming companies from other industry to help them build their brand image. This is an inexpensive start-up and with its internal expertise of building its own brand, it can definitely advise others to do the same.The firm can also enter into the tours and travel market by forming tour operations in the cities where they are present. They have all the resources for this business and can be a good revenue generator and compliment the apartments business.
In addition to this, the firm must strengthen its existing relationships with customers, suppliers, contractors, advisors, etc. The firm must also take into account entering any niche segments of hospitality market such as providing custom made holidays with activities and free travel vouchers, etc. It will need to rethink its strategies to keep a healthy relationship with its customers by infusing all hotel staff into regular and periodic skills development, and people interaction teachings. This will keep the service standard more standard than fluctuating across its properties. Maintaining its market share is tough in a competitive market and this will require a lot of innovation in its product offerings and keep her customers engaged with the firm and its brand image. This can sustain its present portfolio of customers and consistent efforts can help in capturing a new clientele and keep them with the brand wherever they travel.
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LO 3 Revising business objectives and plans to incorporate proposed changes
LO 3.1 Assessment of existing business objectives and plans
Following are the current business objectives and plans:
The firm wants to enter emerging markets cautiously by partnering with property owners rather than purchasing properties. This is a low capital investment method of entering a market and produces low risk and it is a well strategy as a small business enterprise. It wants to continuously enhance services by studying the market conditions and various demand and supply factors. It desires to become a leading serviced apartment provider across all demand segments and geographical regions. Additionally, it wants to address various undersupplied markets by moving there immediately and cater to the pending demand of the region. UK is also undersupplied and most corporate employees agree to stay away from their desired location (Magazine, 2014). It wants to ensure that the clients have the best experience in staying by taking feedback and suggestive advice from customers for further improvement. Constant improvement of service is one of the major objective of the company in all countries. The company wants to bring all properties on a global platform through a system of universal booking which can provide immense brand recognition to its customers in the countries of its operations, and plan and create substantial financial and supply resources to meet future demands of growth by adopting strategies targeted towards relationship building. The firm also wants to provide year on year profit to investors, clients, owners, and also to employees from successful operations of apartment projects.
LO 3.2 Revising business plan to incorporate appropriate changes
Prepare a master data sheet of customers across all countries an segregate them into a groups of most spending ones, average spending ones, and less spending ones. Also divide the list into repeat customers, customers having stayed only once, customers who had effused to stay because of a specific reason. This will give the company a crystal clear view of the type of customers it caters to, and depending on it, the firm can strategize to address those concerns (Reid and Bojanic, 2006). After that, conduct surprise audit of properties anywhere without prior notice to check the motivation of the staff to deliver the minimum service requirements. It can also send some guest in disguise to check the resilience and the service quality of the property. The firm should streamline all its operational data into a single operation style to enhance productivity of employees and manage resources with ease. Further, the firm must prepare a plan which assists in environmental protection and reduce the use of products like plastic which spoils the environment. This will help in saving finances, and also create an image of the brand which is environmentally concerned. The company must also prepare a suitable master plan for incorporating the employee expertise and putting them into the right positions to increase the quality of outcomes. And finally it must induct more advisors into the company which would provide advice on future expansion based on research studies, on managerial expertise, employee productivity, and customer relationship and supplier relationship management.
LO 3.3 Action plan to implement the changes
Following is the action plan:
Contacting all major advisory firms who have expertise in serviced apartment advisory business and negotiate with them before hiring a single expert.Chalking out a plan of an aggressive recruitment drive to attract the best talent in the industry and conduct rigorous interview sessions with newcomers. Taking advice from the government about sustainable development practices which can be adopted in their properties and prepare a plan of products to be replaced or suppliers to be replaced. Conducting extensive research into the changing trends in the industry and adapt new strategies linked with rising opportunities (Schaffer and Thomson, 1992). Addressing the growing demands by upgrading the services by working extensively on advisor reports, customer feedbacks, intuition, creative solution strategies, and implementing property level, region specific or country specific changes according to local demands.Studying the effects of the changes applied and reinvent the strategies to accommodate missing demand delivery. Conducting a property wise survey of missing services which exists in the competitor’s property and address the procurement team to address the need.Gathering all corporate company data in the city of operations and prepare a plan to contacting each one of them by the marketing team to negotiate a staying contract with them. The firm must also gather the competitor data of such contracts to try and over-deliver them to capture higher market share.
LO 4 Examination of the impact of the change management on the operations of the business
LO 4.1 Impact of the proposed changes on the business and its personnel
The business will start to become more predictable because of a single master data management allowing everyone to access crucial information from a single data thereby minimising human errors and disruptions.The employees will start to feel more relaxed because of an environment conducive to growth in a predictable way and be able to manage crisis in a calm manner rather than becoming stressed. This is very important because a happy employee can produce ten times more result than an unhappy one. The work life balance of employees will become better resulting from a streamline operation, removing any possibilities of data mismatch or lack of data and resources to be used and implemented in various processes. All these efforts will eventually affect the hotel properties and its operations. The properties will enhance their life by adopting sustainable development standards and by building an image which is caring for the environment. This will have serious impact in its customers who will also tend to turn into responsible travellers wherever they go. In short, the business will become profitable year on year and produce significant return to its investors, property owners, and employees too will be paid performance bonuses to encourage better performance in the future.The financial health of the firm will be healthy from increased sales, promotions, and marketing cost could go down because of the brand building exercise pulling new customers automatically without much of advertising. (See the solution of Unit 5 Aspects of contract and Negligence for Business)
LO 4.2 Management of the changes in the business
The successful changes becoming visible in the business will need to be made into a benchmark of business operations and making them into minimum acceptable performance standards and service quality. The sustainable development tag can be enhanced by getting accredited with various global environmental protection bodies and getting properties certified by them. This is a tremendous positive tag on the property to attract responsible travellers. The profits of the business must be invested into building more momentum by entering new markets of importance.The employee efficiency reported must not be wasted and can be reinforced into making exciting new challenges known to them to keep up their motivation. The employee need to be rewarded to make them aware about their importance (Kotler and Keller, 2012). The change into the operations effectiveness of the company must become an example in the industry. It must be trademarked and protected to enhance the company value. This particular change can significantly improve the image of the company and build its brand equity worldwide. This change can also be used to enter markets which were difficult earlier, but now with a refreshed image, the brand can be easily accepted. The change in the company image and customer perception must be carefully recorded and must be converted into reference points whenever required for quick fixing of issues.
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LO 4.3 Monitoring improvements in the business performance over a given timescale
The progress of the company’s improvements must be recorded and should be linked with the customer demands over a growing time scale as demands tend to change with time. The environmental improvement must be carefully studied over the years and must be periodically checked with government organisations and global bodies which may change their minimum sustainable development standards. Financial improvement must be appropriately distributed among owners, investors, management and employees. This will also create a non-discriminative image of the company. Substantial investment must be made in the refurbishment divisions to keep the properties equipped with latest technology requirements. Resource management must be recorded for future reference and shifts must be made towards sustainable and environmental enhancing product vendors. Employee efficiency must be observed with changing times and the business objectives must be set up in such a way which also enhances and meets employee’s personal goals.Doing thus will create balanced success and everyone will have felt the collective as well as personal victory. Management transition must be carried out in a way which keep the internal values and principles intact and provides fresh incentive in solving problems.All improvements achieved in developing a master data profile must be invested further by attaching the customer requirements against their information which will then provide a detailed customer profile reducing chances of lack of customised service to each one of them.The corporate clientele developed must be maintained and retained by consistently offering them value for money affordable services, customised services, and upgrading them to priority customers list offering them extra services for low charges. This would make sure the client stays with the firm for long and over time would develop deep engaging relationships bringing in more of their associated clients to the firm.