Assigment 301
- 1. The Open University of Sri Lanka Bachelor Management Studies, Academic Year 2015/2016, Management theory and Practice MUC1201. Assignment No 301 Student Name : M Dharshan Registration No : 515428795 ID No : 820753429v Date Of submit : 14th of August, 2015.
- 2. Organizations are depending on environment irrespectiveof their size and type. As environment can cause for favorableand unfavorableeffects to the smooth functioning, organizationhave to respondto environment changes? An organization must have the ability to examine and make changes based on environmental factors that affect its performance. The use of tools to analyze these environmental factors is the key to a successfulorganization. There are two types of environmental factors: internal environmental factors and external environmental factors. Internal environmental factors are events that occurwithin an organization. Generally speaking Internal environmental factors Internal environmental factors are easier to control than external environmental factors. Management changes Employee morale Culture changes Financial changes External environmental factors External environmental factors are events that take place outside of the organization and are harder to predict and control. Changes to the economy Threats from competition Political factors and Government regulations Technology improvement The industry itself
- 3. 1. Identify a business organization and explain how environment affects to the activities of the selected originations. In 2013 under DNC Asiatic holding sdn, Bhd the companys 1st motorcycle assembly plant expansions in Sri Lanka. The purposeof this assignment is to critically analyze the context within which the company operates by analyzing the external and internal environment. In order to achieve this different analytical tools and models will be applied. Then the objectives and strategy of Demak Lanka Sales & services (PVT) Ltd will be identified and evaluated. 1.1 Internal environmental factors 1.1.1 Management change The Demak Lankas history they started the business on middle of the 2013 those day company managed by Malaysian management, they sell motor bikes to Sri Lanka the overall market per month was 13000 units including Bajaj, TVS, Hero, Yamaha and Honda as per Registration Motor vehicles departments Repots . From June 2013 to December 2013 Demak Motor cycles was contribute just only 2% Market share,
- 4. June 2013 to December2013. 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 20000 Jan Feb Mar Apr May Jun Jul Total sales Demak sales Bajaj 41% Honda 24% TVS 11% Hero 13% Yamaha 4% Demak 4% Others 3% Total
- 5. When the New Year stared 2014 Malaysian top management decide to change the business for local manager, they done well most of experience players were knowledgeable about completion, culture and geographical situation also they implement some good process delivery system and fill the channel gaps from this process Demak capture the 4 % of market share on overall sales. January 2014 to July 2014. 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 20000 Jan Feb Mar Apr May Jun Jul Total sales Demak sales Bajaj 41% Honda 24% TVS 11% Hero 13% Yamaha 4% Demak 4% Others 3% Total
- 6. 1.1.2 Employment morale. As per above management changes of Demak Lanka employees morale got effected. Some of the middle managers and executives had some issues to work with new process.The reason was they already reported to Malaysian top management on past, Now they feel uncomfortable to work under new manager they had a prestige problems. 1.1.3 Cultural changes. The inter company culture was change by new Local managers they kicked of the Malaysian processes in company. Following the Malaysian management process and culture to organization it similar to international business environment very tuff to follow but neat and accurate for run the business well. But now local managers just chase the sales only, they never think about organizational ethics and rules. After six month the Demak Lanka were got complicated culture it seems like a puzzle. 1.1.4 Financial changes. Financial mentioned organization was got some changes after the new management they follow the costcutting in every part of organization, it reduce the 10% of lose in financial quarter, limited resources only to be use to achieve the company goals.
- 7. 1.2 External environmental factors. 1.2.1 Economical changes. Economical changes can find by 2 models Micro economical and Macro economical. Micro Economicalfactors Market size Demands Supply Competitors Distribution chains Macro economicalfactors Interest rate Taxes Inflations Currency exchanges
- 8. Micro Economicalfactors The micro economical was highly effect the Demak Lanka Marketsize was 13,000 to 15,000 units motor cycles per month, the former Malaysia team was not create a good Demand for the relevant product. Competition was highly influence in the market. Bajaj 46%, Honda 22%, TVS 10%, Hero 12% but Demak was contributing just 4% only, the reason was they didnt fill the channel gap and Distribution chain all over the country. Bajaj 46% Honda 22% TVS 10% Hero 12% Yamaha 3% Demak 4% Others 3% Total
- 9. Macro economicalfactors Macro economy factor was not affected that much to Demak Lanka customers to buy a motor bike, the leasing companies was provide the same Interest rate to Demak Lanka also as usual competition. Taxes will not effect to Demak Lanka because they are brought to Sri Lanka by Board of Investments (BOI) project of government terms and conditions. Inflation affected the business smaller percentages to Demak Lanka, by dollars rate changes they have to change the Prices as per the money Inflations. 1.2.2 Threat from competition. Demak Lankas competitors become highly Problems to company, they approached the Demak dealers to sell them productand they give some good offers to Demak Lankas middle managers and took them to work with competition organizations. 1.2.3 Political and Government regulations. Political and Government regulations not impact to Demak Lanka highly, the business was brought to Sri Lanka by Government from Malaysian investments. But the political parties can be a threat to them, if Government got change may be new Government can cancel all international investment in Sri Lanka.
- 10. 1.2.4 Technological Improvement. On the 21st century is a Technology world basically the competition they introduce to market by new technologies. Bajaj - DTSI Hero FI TVS CCVTI Honda- HTC These all technologies improve by competitors to give better performance and for the good millage, but Demak Lanka still pending on them technological improvements. 1.2.5 Social and Geographical interference. In Sri Lanka geographical and social cultural was different by town to town. It affected to Demak Lanka to sell motor bikes, they mostly focus on premium bike segments those kinds products is not useful to Famers and fisher mens They need some think with carriers to improve the business and incomes, basically city people like Demak motor bikes who works in executive levels in market mostly 80% of people who are live in 3rd classes they are famers, fishermens, carpenters, and black smiths. The Demak Lanka need to bring some bikes to 3rd class people use also.
- 11. 2. Explain with exemplas how managers would face the new challenges of todays business environments. Growing businesses face a range of challenges. As a business grows, different problems and opportunities demand different solutions - what worked a year ago might now be not the best approach. All too often, avoidable mistakes turn what could have been a great business. 2.1 Internal business environmental. 2.1.1 Management changes. As per Demak Lanka management changes made many things in organization the process, culture and systems also. The solution can be only one as a manger we need to co-operate with them and we need to practice to new managements theory. 2.1.2 Employees morel. Mention organization was had a problem one of the sales staff on his past he work well and he achieves the target. after 2 years he got fade up and his preferments was gone down the management set him for a motivational program and changed his area to work, he stared his work freshly and new area gives him new view to work, after he achieve his organization targets. 2.1.3 Financial changes. The Demak Lanka management change was financially made big threat to organization, they work for costcutting stopped the promotions and ATL activities press ads, TV commercials and the sponsorships. At this situation the sales team was struggle to achieve the target without the ATL campaigns. The sales team set for a discussionand they try it in other way for small BTL activities and for institutional sales (group sales) on that way they prove the achievement to organization and make them profit.
- 12. 2.2 External environmental factors. 2.2.1 Changes to economy. Basically Demak Lanka was depending on Malaysian Branded Motorcycles. On 2014 part of the inflation the US dollars was gone up it interfere Demak Lankas productPrices they had to increase the prices for 3%. The management handle the situation perfectly they tookup the price for 5% and they give some free attachments to customers. E.g. Fora motorbike customer get free Registration, free insurance or additional helmets. 2.2.2 Threat of competitors. The Demak Lankas competitors was very strong in this business on Jaffna Demak Lanka with a strong dealer to sell motorbikes some of the market leaders were approachDemak Lankas dealer to sell those motor bikes. On this situation Demak Lanka made for Jaffna dealer for a better commission structure and keep with them. 2.2.3 Political and government regulation. The government can interfere to any business, recently the project was started for 50,000/= rupees government organization employees got motorcycles, the tender got by Hero motor bikes and Baja, at this situation Demak Lanka lost the sales bay 75% market share, But Demak Lanka discus with Malaysian management and they arranged a promotion Plane to Privet sectors employees 20,000/= rupees discount, they grow the sales to 50% and went away from break even points.
- 13. Creating a startup, or managing any business, is all about problem solving. Some people are good at it and some are not independent of their IQ or their academic credentials (there may even be an inverse relationship here). Yet Im convinced that problem solving is a learnable trait, rather than just a birthright. Entrepreneurs who are great problem solvers within any business are the best prepared to solve their customers needs effectively as well. In fact, every business is about solutions to customer problems no problems, no business. Problems are an everyday part of every business and personal environment.