Executive Summary
This report has been commissioned by Jeremy Dawes, the owner, and manager of Newcastle Infotech, a relatively small firm specializing in Web-design and software development. This paper analyzes the internal and external environment of the company to identify the factors preventing this business from achieving a more solid position in the market. The recommendations are mostly connected with such aspects as human resource management, the structure of the company, and marketing policies.
The list of key suggestions
- To hire full-time employees working regularly
- Departmentalize the company
- Set more stress on advertising and branding
- Adopt flexible pricing policies
For more detailed information, please, refer to the enclosed document.
Business Report
Introduction
This report aims to discuss the situation that has recently emerged in a small web design company Newcastle Infotech. The main task is to propose methods to boost the firms growth and profitability. This investigation will rely on the study of the internal and external environment of this enterprise, in particular, its services, marketing strategies, relations with the customers, communication process, and so forth. This will enable us to map out the action plan which can help to strengthen the positions of Newcastle Infortech in the market. During the course of this investigation, we are going to employ SWOT analysis in order to outline the key directions for improvement.
Analysis of the internal and external environment
Problem Statement
Newcastle Infotech was founded by Jeremy Dawes and his associates in the late nineties, at the moment when such a sphere as E-business was relatively new. Currently, this firm provides a wide range of services, namely, Web and graphic design, optimization of search engines, computer repair, and installation of the new software (Dawes et al, 2008). For a considerable period of time, this enterprise has flourished due to the diversity of its activities, good interactions with clients, and the creative approach taken by the management. However, in recent years its profitability has declined. We can single out several reasons for this: 1) the electronic market has become oversaturated with firms, specializing in Web design and related areas (Chaffey, 2007). Consequently, the competition has intensified. The key issue is that the rivals of Newcastle Infotech are more focused; they major in some concrete branches of Web design or hardware and spend considerable amounts of money on R&D (Research and Development). Hence they can ensure the customers satisfaction. 2) The difficulties, faced by Newcastle Infotech also take their origins in poor advertising strategies. The firm is practically unfamiliar to the target audience and many people in Australia as well as in other countries do not know about its existence. 3) The third factor which prevents the company from reaching its full potential is human resources. At present, Newcastle Infotech has a relatively large staff but the employees (programmers, designers, and engineers) work mostly “on a casual basis” depending on how busy they are (Dawes et al 2008). This drawback gives rise to several controversies: first, they cannot fulfill long-term projects that require constant commitment and full-time employment. Furthermore, due to this instability, the firm cannot always meet deadlines set by their clients.
SWOT Analysis
We need to employ such research methods as SWOT analysis to determine the strengths and weaknesses of this enterprise as well as outside factors which can be either beneficial or harmful for Newcastle Infotech.
Strengths:
- Variety of services. As it has been noted earlier, they develop and maintain websites; install intranet software, create databases, customize already existing solutions. Additionally, they perform repair jobs, restore data, diagnose hardware, and so forth. This diversity may help them to become popular in Melbourne and all over Australia (Dawes et al, 2008).
- Experience in this field. Newcastle Infotech began to operate in the late nineties since that time the person has had a good opportunity to acquire new knowledge and skills.
Weaknesses:
- Inadequate advertising strategies and lack of publicity. Currently, the news about this firm is spread only through customers who can recommend it to other people. Certainly, their feedbacks and testimonials are very important, but they are insufficient at this stage (Kaynak et al, 1996).
- Personnel. Some participants cooperate with the firm to carry out only short-term projects. Newcastle Infotech does not have a working schedule and this is by far the biggest drawback. 3) Organizational structure. This firm is not divided into separate departments as it should be especially given the fact that the range of their activities is very diverse (Chaffey, 2007, p 238).
Opportunities:
- Increasing demand for Web products:
- Location. The company is located in Melbourne, one of the biggest financial and industrial centers in Australia. Therefore, a great number of clients may be willing to collaborate with them. Threats: intense competition. Since the late nineties, the E-business market has become saturated with companies that provide similar services.
Proposal:
Judging from these facts, we can argue that the main obstacle on the path to continuous improvement is human resource problems.
- First, Newcastle Infotech should be fully staffed with people who are ready to work constantly for this firm. This may enable them to achieve a higher level of stability. This will also establish good workplace communication in this enterprise because at present some programmers or designers work only online. Sometimes, this causes delays and poor interactions among colleagues. The experience of several leading companies indicates that the effective flow of information is a powerful stimulus for success (Locker & Kaczmarek, 2007.p 9).
- Secondly, the management should bring changes in the structure of their business: it should be departmentalized or split into several sections, for example:
- Web design and graphic animation;
- The development of software solutions and databases;
- Hosting;
- Repair of computers and installation of new operating system;
- Quality assurance department. This division is based on the activities of Newcastle Infotech and its key objectives. This restructuring is necessary because now working procedures are organized haphazardly.
- The third direction is the marketing approach taken by the management. This brand is hardly known to the general public, only clients testimonials give publicity to them (Dawes, 2008). Thus, they need to conduct an advertising campaign, which would emphasize the range and quality of their products and services (Meyers & Gerstman, 2001). Afterward, the management will have to pursue flexible pricing policies, giving discounts to returned customers or even offering certain bonuses for them.
Conclusions and Recommendations
The success of E-business is shaped by the following factors: diversity and quality of products and services, organization of the firm, and marketing strategies. The recommendations, advanced in this report involve such steps as hiring full-time employees, being able and willing to work on a regular basis: splitting Newcastle Infotech into several departments, each specializing in one particular area, and adopting new marketing strategies which would include advertising campaign and pricing.
Reference List
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