Striving to establish a competitive advantage is a principle strategy for many organizations. Both local and international companies aim at gaining a considerable market share and enhance sustainability. However, irrespective of the company’s strategic approach towards beating the fierce competition in the market, oversupply and new market entry will still be realized. In that case, R&D experts of the Blue Ocean Strategy argued that the primary action plan to winning the competition is to halt trying to beat the competition. Alternatively, they suggested that other than entering the Read Ocean, which is already bloody, an entrepreneur should venture into the Blue Ocean to enhance market demand. Reviewing the Blue Buddies’ management organization, this paper is a case study that evaluates the levels of business strategies (Ardian, & Syairudin, 2018). The paper further formulates and analyzes the implications of corporate level strategies on sustainable strategic performance in an international context. The assessment of Blue Buddies strategies will also be referenced from its organizational strengths, weaknesses, opportunities, and threats.
Strategies of diversification are utilized to enlarge the company’s operations by the addition of products, markets, services, and stages of strategic production in the common market. The fundamental aim of diversification is to enable the Blue Buddies Organization to enter the levels of businesses, which are dissimilar to the present company’s operations (Batterink, 2009). The corporate level diversification strategy in the Blue Buddies during the end of the simulation when the Red Box and the Blue Box are denoted as different business units is the Concentric Diversification (CD). The Blue Buddies’ strategy by that time was related to the regular lines of the organization.
In the years 47 to 49, the company has strategized to make use of some funds that were initially allocated to the Red Box to enhance the growth of the Blue Box. The company’s Red Box denotes the present products in the worldwide market, whereby no observable transition was formulated in the gaming model. As such, the organization reaches an agreement that is was reasonable to use funds allocated initially to develop the Blue Box. In that case, the strategy stimulates the company to establish three fundamental objectives over the following three years (Becht, 2005). Through the end of the simulation process, the Company plans to enhance EBIT, forming the gross percentage of revenue by 5% to 15% annually. The strategic approach would enable the Blue Buddies to retrieve its position considering its previous performance by year 46, which is speculated to proceed on in the following years. Another objective is to increase the gross revenue to $970 Million by the 49th years, which is meant to retrieve the lost market shares from the last rounds. The last objective is to enhance the rate of market share by approximately 1.5% from the Blue Box by the 49th year. This objective is a viable increase of about 0.5% achieved in the consecutive years.
The diversification strategy is to evaluate and convey the Blue Buddies transitions to the Blue Box and Red Box products to both the clients and non-clients while assisting the company to enhance its market penetration as its global expansion rate increases. Considering the enhancement of the product, marketing budget by $24,000K to offset major transitions made in the preceding years is evident in the Blue Buddies. The company’s commercial project was formulated to invest and hire competent skill trainers to the Trina Distributer’s Sales Team (Borgianni, Cascini, & Rotini, 2012). This project was indirectly interrelated with the issue above with non-clients being incapable of receiving adequate information to enhance their chances of purchasing. The fundamental aim of this corporate level strategy is to help the company to achieve a strategic fit, which enables the company to attain synergy. Principally, synergy is the capability of multiple parts of the company to attain a greater overall togetherness obtained when efforts of different parts are added. Synergy is attained when firms combine with similar financial, marketing, management and operation efforts.
The Boston Consulting Group (BCG) matrix illustrates the significance of the Blue and Red Box product of the Blue Buddies. The findings of the matrix stipulate that the Red Box product be represented by the question mark upper right side). However, the Blue Box is on the left side, and denoted by the ‘cash cow.’ The source of income formulated by the organization has high relative market share and low market growth rate. Since there is a relatively high share of the market, the generation of profits from the Blue Box products is also high whereas the growth of the market and investment required is low.
As such, additional funds can be utilized to enhance the global expansion of Blue Buddies’ divisions and products. The question mark denotes the Red Box Products, which have significant growth in the market. However, the Blue Buddies itself is unable to achieve a significant share of the market from the Red Box Products. The red ocean is the worst for the organizational case because the market is expanding yet Blue Buddies is unable to capitalize its strategic situation (Carton, 2017). When the ‘question marks’ are maintained this way, they will lead to absorption of cash, which will ultimately escalate to a ‘dog’ when the growth of the market diminishes. One of the most fundamental critiques of the matrix is concerned with the conclusion that greater market shares signify more profit, which might not happen as intended. There is a probability that the Blue Buddies has a lower share of the market, because of strategic marketing and higher prices, irrespective of its high prices. Resultantly, this leads to more profits, regardless of the minimum share rate. In that regard, the BCG matric is limited and cannot deliver a realistic picture.
The Blue Ocean Strategy and methodology is applicable in Blue Buddies’ case study to formulate a customized process of management, about the new marketing perspectives, in addition to organization practices in the global extent. The action plan illustrated is based on strategic enhancement of Blue Ocean’; implementation, development, control, and evaluation of Blue Buddies strengths, weaknesses, opportunities, and threats as indicated in figure 2 below.
The company has comprehended its strategic position after the 46th years that its global expansion in the Starland has overextended the company too narrowly. Moreover, there is an increased number of complaints from the company’s suppliers at Roundland. In that regard, the company needs a low strain and cost remedy in order to be sustainable in transnational and multi-domestic markets. Non-clients have also provided their numerous concerns, which include the intensity of risks realized when purchasing gaming consoles that have a connection problem with the present television sets (Carvalho, 2012). Another issue is that non-clients are apprehensive concerning the process of maintenance and repair when consoles break down.
Concerning the potential future strategic alliance of the Blue Buddies, it is affirmed that when confidence exists in the Blue and Red Box products, the use of a concentric strategy to establishing a standard warranty of three years is advantageous. Accessing assistance after sales is a major concern for clients. However, the customer’s fundamental questions concerning the ‘after sales help’ were about the position to return the broken consoles and who were the distributors and salespersons (Chan Kim, & Mauborgne, 2005). The significant values, incorrectly predicted, were multimedia adds-on, console power, online gaming systems, and the audio sophistication. On the other hand, the controller sophistication, rechargeable batteries, and exergaming systems have surpassed the expectations of the market. About the competition rate, the prices of the Blue Box products are high and unfordable for the clients. The company lost the profit margin since there were inadequate attributes either eliminated or reduced.
The choice concerning the strategy for diversification of the Blue Buddies Organization denotes a significant scope of a decision-making process that is capable of influencing the industries and markets that the organization will compete against in future. Organizations can expand or decrease their diversification level for multiple reasons. These include, for an economic motive to pursuit economies of multiservice scope and scale, which will result in the lowering of the per-unit expenses through an increase in sales and fixe-expenses reducing profits connected to strategic growth using diversification (Cheng, & Yang, 2013). Even though the concentric approach and the entropy measure are denoted inversely, they depend on the same fundamental supposition concerning the SIC systems, whereby the validity of the hypotheses are questionable. In SIC, organizational activities are collected as a single industry (4-digit level), which is aggregated to industrial groups (3-digit levels) and lasts to major groups (the 2-digit levels).
Merger & Acquisition (M&A) are illustrated as an alliance of industries. When the two terms are differentiated, Mergers form a single company by combining two of them, whereas an Acquisition is only company takin over another. With the fundamental objective of maximizing wealth, the Blue Buddies should keep evaluating numerous chances using the methodology of merger and acquisitions (Child, Tallman, & Faulkner, 2005). The need for a consolidation strategy for M&A arises due to the company’s vision to expand. This alternative is used to expand organically, or within a firm, which can happen due to various instances. M&A strategy for the Blue Buddies involves synergies that involve management competencies and costs, which would be operational.
Advantages of Consolidation
The Blue Buddies Organization considers global expansion and sustainability as a long-term improvement of its corporate values and organizational priorities. The corporate governance of the company should formulate a positive association with the relevant stakeholders, customers, community, business partners and employees (Dive, 2008). Moreover, the relationship should include a consistent provision of strategic products, which satisfy clients. The Blue Buddies should seek to enhance its corporate governance and apply general codes and principles of governance.
Figure 2: Corporate Governance Structural Illustration
Policies that safeguard the interests of relevant stakeholders to invest in future include, but not limited to
Objective and Nature of Blue Buddies’ Policies: The Blue Buddies protocols are formulated to define the rules that Blue Buddies has stated to be relevant to extreme situations in the company. The rules bind neither corporates nor business members.
State or Federal Rule Compliances: The Blue Buddies Organization expects that businesses will abide with all the guidelines in state and federal dimensions, including the stock exchange entry regulation.
Divulged Corporate Governance Ethics and Policies: Blue Buddies has a belief that each company needs to create a written divulged governance policies and procedures, including the code of conduct applicable to all the directors and employees (Estrin, & Meyer, 2007). The company hopes that the board of directors will meet the standards to safeguard the interests of shareholders.
Shareholders’ Accountability: The practice and structure of corporate governance need to enhance and safeguard the accountability of the company to the relevant shareholders to assure equal treatment.
Participation of shareholders: Shareholders need to have a significant ability to take part in voting, including fundamental choices affecting Blue Buddies’ viability. Shareholders also need to participate in significant chances to nominate or suggest directing candidates, formulate processes of evaluation and selection.
Justification
Based on the corporate governance policies, the Blue Buddies believes that firms need to adhere to a specific formulated guidelines of corporate practices and current corporate residency (Gündüz, 2018). Adoption, promotion and efficient implementation of rules for effective conduction of the firm and its relationship consist of fiduciary obligations to enhance continuing venture activities in the future.
The essential features attributed to the Blue Buddies employee’s code of conduct include:
In compliance with the organization’s workers code of conduct, it will uphold the augmentation of one’s educational progress and also be beneficial to the organization in the end. On the other hand, clear comprehension of the disparity existing on what is required to be done and not to be done within the organization results to the safe working environment. On most occasion, people use bunk offices because they do not fully understand if such activities are incorrect or affect ethical conduct (Klein, Mahoney, McGahan, & Pitelis, 2013). Workers principles always make sure that staff members abide by various rules and regulations additionally ensuring that they work for the firm.
Certain traits of the high ranked managerial personnel members of the Blue Buddies firm in the final simulation included:
Centered on the structured shared skill plan and other consequent professional advancement schemes various improvement outlined below has contributed to the success of the planning position.
All based techniques mentioned in phase 3 of the skill sharing scheme has been applied. Generally, these stated policies are overall attendance in a congregation, job shadowing, core introduction of the career development schemes, significant progress made, which comprises of around 70% of the commodities under completion (Lee, 2013). The improvement of various projects is estimated obtained through weekly meetings involving the successions planning position and the capable successors. Thus the offices account the weekly findings to the headquarters that are responsible for trailing and observing several HR activities.
All the approaches employed in the process of knowledge sharing have already been implemented. Roughly, such strategies include the use of SOP review, job shadowing, completion of managerial roles with the help of office support based on the career improvement scheme, this shows that the critical advancement has already been achieved, estimated to about 85% of the selected commodities by the managerial body (Øivind Madsen, 2017). Advancement in the direction of completing a specific task is evaluated through weekly based summits amid the current planning body and the prospective successor involved in the plan. Therefore the personnel in office thus provide a summed report to the managing body for evaluation and supervision.
It is estimated the about 50% of the policies mentioned in level 3 of the skill transfer scheme has already been instituted. Principally such approaches include: job shadowing, SOP review, the introduction of various career development schemes, limited progress has been done which comprises of about 35% of the mentioned items to be completed (Oxley, Rivkin, & Ryall, 2010). Advancement about completing a particular task has not yet been established. Thus various arrangements which are aimed at doing such are inclusive of various weekly statements which are emailed by prospective successors to the individuals in the offices, who provide additional support when required. Thus this activity is thus evaluated after six weeks. Therefore the chief merits existing between the leadership succession schemes provide the capacity to the Assistance Director of Administration on focusing the productive labor force and the succession planning of several staff members who are aspiring to improve the future action from where there is proper documentation of various positions (Randall, 2015).
In order for the Blue Buddies organization to improve its entrepreneurial plans and administer increased and fundamental innovation processes, it has to make use of various innovative techniques for the firm. This type of entrepreneurial approach focused to be instituted by the organization is to increase and uphold with the company’s competitive through the modification of various internal systems, structures, and its ability to innovate. Alongside the framework used, much stress if pointed out towards the chief factors associated with the internal organization functions which are carried out (Renou, 2006). Due to this much attempt is focused on the production of rigid managerial tools within the company’s policies in order for their implementation process. The company’s transformation provides that capability of the business acquire maintainable competency without changing the organization’s strategic policies, the offering of other products, and covering other markets aspirations.
Indeed there are exist various scenarios when the firm’s innovation process is considered as an essential factor within the whole company’s operations, which include the business processes in re-engineering (BPR), which is mainly targeted at structuring and improving the organization’s value chain respectively (Schwartz, 2014). Additionally, the reconstruction of the organization mainly related the involvement of a single transformation practice which is profound to have the profound effect on the firm’s body, for example, the deliberate reformation attempts, or minor transformation processes which attribute to an increased level of efficiency during the implementation process. Nevertheless, it is correct that the company’s rejuvenation process, the implementation process should be familiar to the prospective initiative.
The section below explains various levels in commencing, managing and finally triggering Blue Buddies recovery program.
Level 1: Inspiration of need for amendment
The present status will be denied, the present believes confronted, and the unknown factors upheld. Thus the transitioned mindset required for brand revival is necessitated for the creation of a practical solution in the event of failure or success.
Level 2: Possessing an individual mindset and the generation of the intellect of understanding
The greatest brand tools are not based on the sex and the one’s level of income. Thus most individuals have the feeling that they have a close relationship aside from the purchase of a product of service.
Level 3: Admiration of being disregarded
Commodities which are in alignment with the current trends in the marketplace abide by the customer’s rules and consideration. They significantly influence the comprehension of consumer knowledge of the topic which profoundly impacts the livelihood.
Level 4: Imagine as one and do as one
One should be highly considered during strategy implementation process. Although it might be intimidating when using ineffective strategies since poor implementation process will result in poor performance.
Level 5: The type of brand
The type of brand in an organization is useful for the improvement and adjustment of the company’s brand. This will determine the mindset, execution process of the organization’s activities.
Blue Buddies market performance can expertly be evaluated through the use of a balanced scorecard, which carefully outlines the organization’s aims and objectives (Rush, 2012). Being in a position of settling on the use of a capable, balanced scorecard of will commence a new beginning for the organization success. The primary keyword used in this section is “journey” which structures the scorecard system which provides the timeline of the project. Being attached to the balanced scorecard model will provide a beginning for the improvement and thus signify a significant cultural disparity within most firms (Varia, 2005). The effective use of a balanced scorecard will be a signal for the effective performance of the managerial process which increases the possibility of increasing organizational transition and uphold accountability in the organization.
Commencing with level one which relates to organizational appraisal, pains, values, change management and the scorecard improvement processes prepared, visions and missions will be authenticated. Level two relates to consumer and shareholder costs proposals which are highly precise and are used in the creation of the company policies. In level three comprise of the aims and objectives followed by step four involve the strategy maps of the organization. Level five involves the improvement of critical strategic procedures (Violet, & H.Josiah, 2011). Level six is used for the establishment of various initiatives which provides a basis of fruitful strategy. Level seven involves the automation process while level eight relates the migration of the scorecard into various business units which helps the HR relate the corporate visions and strategies in function. Level nine is an evaluation process which is for the completion process, thus to comprehend the managerial systems specific changes should be included in the company’s strategy.
The application of BSC in the company is limited to financial costs ventures and time. The BSC system needs a substantial investment since it is a long-lasting solution. Blue Buddies requires to manage its systems regularly and actively, which means time and finances need to be invested (Wratschko, 2009). In that case, Blue Buddies’ workers need to understand the operation of the system, which might force the company to spend more to facilitate the training of non-competent staff.
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