Introduction
The purpose of this report is to provide a brief description about the strategies implemented by the company Zenos Cars. The company is placed in the automotive industry of UK and was introduced in the year 2012. The report evaluates business strategies adopted by the company with an aim to organize activities in such a way to develop competitive advantage for them. The report explains the strategic choice of the company using various tools and strategic frameworks. It assesses background of the company along with the literature review on strategy and its characteristics as well (Shields, et. al., 2015). Furthermore, it also evaluates the strategies of Zenos Cars using the Mintzberg 5P’s analysis and PESTLE analysis. Finding and discussions in report evaluates the current strategic position of the company and analysis of the tools used. In the latter part, company’s choice, goals, approach and performance is also explained.
Strategy is very important for the business as it helps them in creating an impact on the external environment using the internal capabilities. Strategy refers to a plan that is designed in a way to attain maximum profits for the company. Without an adequate strategy, the business cannot successfully run in the target market, a strategy implemented by the company helps the management in organizing the activities and using all the available resources to earn profits for the company (Buckingham, and Goodall 2015). Further, more details about the report are discussed below:
Background of company
Zenos Cars is a British automotive company has is involved in the business of producing high-performance and lightweight sports car in the target market. The company is based in Wymondham, Norfolk, UK. The organization designs, manufactures and sells three types of Zenos E10 cars. The company is a private limited company that was founded by Ansar Ali and Mark Edwards for producing sports cars in the market of UK (Zenos Cars 2018). The name of the company Zenos, means vertebra or spin in Latin. This word reflects the key architectural elements of the products of company. The purpose of the leaders to introduce this brand in the market was to fill the gap of light weight and contemporary high performance cars that is economical for people as well. The purpose of producing Zenos car was not to offer high fashioned branded sports cars, but to present a sports car that is easily affordable by people and one that can easily run on road. The initial model introduced by the company includes the E10 series line. Further, the company is also known for introducing innovation in their products, the E10 R range products of the company are giving three choices to the customers for enjoying the invigorating experiences on road. Basically there are three product lines in the company that are E10, E10 S and E10 R, all the three types of products offer differential options to the customers in the market. Apart from producing and manufacturing cars in the market of UK, the company is also concerned towards their environmental sustainable activities and comply them accordingly (Zenos Cars 2018).
Strategy and its Characteristics
Strategy refers to the high-level plan initiated by an organization with an aim to achieve something. Strategy is very important for the business because it helps the organization to use the available resources in direction of organizational success. Further, Henry Mintzberg from the McGrill University defined the meaning of strategy as a pattern in a stream of decisions to contrast with a view of strategy as planning (Ritson 2018). Whereas Henrik von Scheel defined strategy as an activity to deliver a unique mix of values, while choosing to perform actions differently or to perform different actions than rivals. In the same context, Max McKeown stated that strategy is all about shaping the future and it is natural attempt to get the desirables ends with available means. Strategy is also defined as a defined system of finding, formulating and developing a doctrine to ensure the long term success objective of the company is followed successfully. This definition was given by Dr Vladimir Kvint. Further, it should be noted that corporate strategy refers to a pattern of decisions initiated in an organization that defines the objectives, goals, and purposes to produce the principal policies and plan to achieve the identified objectives (Research Gate 2018). Strategy is the way in which an organization to initiate activities to move towards the goal of the organization and strategic management refers to the process of formulating the strategies and monitoring them so as to keep the goals and strategies aligned in the company. The process of strategic management involves planning as well acting. It is irrelevant to use same type of strategy for all the organizations, as it is the most important aspect that helps the companies to identify their position in the target market. It depends upon the companies, available resources, external environment and many other aspects based on which strategy is proposed and implemented in an organization. Companies with good strategic implementation help the companies to grow from the scratch to the top most position in the target market. Further, there are different levels of strategies that are used by companies such as corporate level strategy, competitive strategy, and operational strategy (B?rzi?s 2018).
Henry Mintzberg, Joseph Lampell and Bruce Ahlstrand present the meaning of strategy in the book, ‘Strategy Bite Back’ in the year 2005. They are presented 5Ps as a way to define strategy for an organization (Appendices 1). Further, the use of this model for the company Zenos cars is discussed below:
Strategy as a Plan: As discussed in the literature review that strategy is a plan for dealing with the situations. A plan is the process that is made before actions are implemented by the organization. Under the process of strategy as a plan, the management of the Zenos initially identified the organizational goals on the basis of which they need to implement the strategies accordingly. With the process of strategic planning, the leaders aimed to create differentiation in the market by producing new and innovative products in the market (Teece 2010). The leaders did not aim for providing luxurious and impressive sports cars in the market, instead they planned for producing cars that are economical for people and is easy to use on road and track as well. This type of plan helped the company creating differentiation in the target market (Mone, and London 2018).
Strategy as a Ploy: This theory of Mintzberg states that ploy along with plan is very important for the business so that the company can earn advantage over the competitors in the target market. Ploy is a strategy that the competitors do not expect from the organization in the market. In simple words, it is just a strategic step which helps the company to move one step ahead than the competitor. Zenos also used similar choice in the market by employing efficient people of competitors (Jenkins, and Williamson 2015). The CEOs of the company hired people like principle engineer of the company Tesla Matt Windle, and many of chief engineers from the companies namely, Lotus Cars, Volvo, Nissan, Daewoo etc. The leaders of the company offered such values to the people to which they were unable to deny. Resulting to which, these people joined Zenos Company that somehow increased the competence of the company in front of its competitors (Vedovato 2016).
Strategy as a Pattern: Strategy as a pattern is an important concept to understand as the future strategies and decisions that are to be implemented are based on this pattern only. As explained in the background of the company that Zenos is a newly start-up initiated by two people so the company is at its beginning phase only. Until this time also, a pattern has formed for the implementation decision at workplace (Grant 2016). However, the objective of Zenos is to expand their scope of business by developing and organizing innovative activities at workplace. The company believes in behaving constantly but it also aims to exploring the external international markets as well. So, there is definite pattern for the organization to follow instead they believe in exploring new paths (Freeman 2010).
Strategy as a Position: This aspect of the theory talks about the position of the company in the target market that is the interaction between the internal and the external market. Under this strategy, the company needs to identify carefully the ways in which they want to position the image of the company where and how. Further, in order to identify the competitive advantage in the target market, the leaders initially identified the competitive advantage that they have with them. In response to which the positioned themselves between the target customers and the companies where no other company can match the attractiveness of products served by them (Siddique, and Shadbolt 2018).
Strategy as a Perspective: strategy is more than just position of the company as it is related larger perspective. Position as a strategy looks in the outward direction of the company while perspective is more about inward look of the company. Strategies under this aspect explain a deep-rooted way of looking at the world. Perspective talks about the opinion of the whole company towards their actions in the external market (David 2011). It is very important to have diversified perspective to reach towards each and every customer present in the market. The company Zenos has an aggressive pacesetter perspective in the market. As the company do not want to settle for anything, resulting to which the management perceives to deliver the best innovative products and services in the target market (Rothaermel 2015).
As Zenos Cars is headquartered in Wymondham, UK so the PESTLE Analysis of United Kingdom for Zenos Cars is discussed below:
Political: Coming up from the time when UK decided to initiate the BREXIT movement, the country has now earned a steady growth in the international market. There is presence of political stability as well, as the country has started taking their decision separately which involves les restriction from the European Union. However, the position of pound has reduced with the occurrence of this event. The taxation policy initiated by the government on the goods gives moderate extent of risk for the automobile companies. The conservative party rules are working properly for the automobile industry (Wheelen, and Hunger 2011).
Economic: Talking about economic factors, the initial point to talk is exchange rate conversion. The conversion rate remains volatile by affecting negotiations with the suppliers. However, there is medium demand of the products and services of automobile industry in UK. Consumer spending habits have increased giving profitability to the companies. UK’s automotive industry reaches to the peak of £77.5 billion in the year 2016 that increases the employment rate in the country as well (Appendices 2). Value added economy of the country rose by 7.3 % giving prosperity to the country (Smmt 2017).
Social: The social factors of the country UK includes cultural diversity as per different regions present in the country. Most disposable income in the country lies in the hands of two age group that are people between 25-35 and 45-60. These people are the one who are mostly interested in purchasing the products from Zenos. The social factors also explain that people present in the country are more inclined towards the automotive industry as they have craze of buying sports car. Also, the preference of people is luxurious and expensive that makes them purchase such products in the market (Hitt, Ireland, and Hoskisson 2012).
Technological: The companies present in the country UK do not face difficulty in attaining adequate technology required by the business. There is presence of automation and disruptive innovation in the market that helps the companies present in the automotive industry to make full use of available resources and reach at the top. The technology present increases online intelligence as well which opens another way for sales of the companies (Schilling 2010). However, GDPR – new regulations came in May, 2018 has increased the pressure for the companies to comply with all the regulations and work effectively in the market. System upgrade facilities available in the market also decreases the differentiation of companies present in the market (Hill, Jones, and Schilling 2014).
Legal: The wage rate and national minimum wage rate increases yearly for the companies but with a medium speed. The companies are forced to implement family friendly regulations in the market that is somehow affecting the growth of the companies. The overall regulations of the country works with a medium rate that does not increases the pressure of companies present or entering in the market (Noland, and Phillips 2010).
Environmental: Lastly, the environmental factors of the country are topic of great concerns for the companies present in the automobile industry. The companies present in this industry re under constant surveillance to initiate environmental and ethical consciousness in the market. However, customer relationships have improved and the companies present in this industry have started using biodegradable waste and using less natural resources as well (Hörisch, Freeman, and Schaltegger 2014).
The company Zenos is doing explicitly well in the target market even after having an experience of short period of seven years only. The company has worked on their management and gained reputation in the target market. Further, the above mentioned models successfully depicted the growth of the company, strategies and the favorable environments for the company to work effectively in the target market. With the evaluation of Mintzberg strategy and PESTLE analysis, following discussions were acknowledged. These findings are discussed below:
The company Zenos planned the approach that can successfully help them to create differentiation in the market. The company did not enter in the market just to become another ordinary sports car selling organization; instead, they wanted to fill the gap that other organizations have created through their existence. The company planned to become an organization that provides sports cars to the people in UK at affordable prices (Wheelen, et. al., 2017). The major aim of introduction of the brand was to provide easy using cars in the market not just fancy cars that are good looking. The company tried all their efforts to gain advantage over other competitors present in the market. Even they hired the employees of competitor’s organization in order to ploy the best plan for them (Waddock, and Bodwell 2017).
Further, it was also evaluated that the fast growing organization only focuses on providing differentiation in the market by initiating innovative activities in the target market. The company does initiate patterns that helps them to remain consistent in the target market, instead they aims to explore the capabilities of the environment by finding and exploring internal as well as external capabilities (Keller, Parameswaran, and Jacob 2011).
Talking about the positioning and the perspective strategy organized by the company it was evaluated that the has successfully launched three series of cars back to back and still they are aiming to achieve the best position in the market. Resulting to which, the company is positioned at an identified position in the market, in the eyes of the customers, the brand is seen as an organization that manufactures highly innovative, efficient and economical products in the market (Drucker 2012). And in the eyes of the competitors the brand looked as a threat that can eat them any day. From the above analysis it was evaluated that the company Zenos used a smart strategy under which they initially targeted the niche market and then slowly and gradually by using adequate resources the company fought with big firms in the target market (Kapferer 2012).
Flexibility of the company and use of technology also helped them to grow in the external market. The technological factors present in UK helped the company to grow and expand. The social factors also explained that the company has several target customers in UK. People have adequate disposable income to purchase Zenos cars in the market. Clean sheet design of the cars attracted the customers in the target market. Lastly, it should be noted that the overall environmental, economic and political factors also helped the company to some extent to grow in the external market (Slack, Chambers, and Johnston 2010).
The company successfully applied adequate approach in the market that helped them to attain identified position in the market. The company used the differentiation focus strategy in the market to secure their position. Under this type of strategy, the Zenos developed differentiation in the target market by particularly focusing on the target customers and their requirements as well. The company initially created differentiation through their products and then they adequately focused on the target segment to initiate revenue (Hickman, and Silva 2018). Further, the organization used economies of scale and adequate technology to deliver the products to the customers at a cost that they are willing to spend. The company proposed a price that is adequate for the products at price acts as one of the biggest reason in influencing the decisions of the customers in the market. Customers are the people who position an organization in the market, so the customers in this case positioned Zenos Cars at a place where they can look themselves as the most innovative organization present in the automobile industry of UK (Elmes, and Barry 2017).
The strategic choice theory explains the role of a leader in influencing the organization by making choices in dynamic political process. The process of strategic choice provides alternatives to the organization that helps the management in taking decision on the basis of internal as well as external environment. In short, strategic choice refers to the choice of the decision that the leaders of the organization take according to the strategic position of the company (Belton 2017). Relating it to the choice and decision making process of the company Zenos, it should be noted that leaders initiate the decision considering various aspects present with them. The external environment is overlooked along with the internal environment and competitors as well. Under this process, the company takes care of their reputation and then finds out the best possible outcome that can help them to sustain their image and resolve the problem as well. The process of strategic choice helps the company to find out various alternatives and narrow down their approach to best possible option that can help them in the target market (Wolf, and Floyd 2017).
Understanding the aspect of goals, strategic choice and stakeholder management is an easier aspect as it just talks about various functions of a corporate, whereas it is comparatively a difficult to understand these functions in a plural context. The pluralistic context in this case explains the perspective of all the stakeholders of the company. It is important for the organization to opt for the strategic choice that considers multiple interests that emerges from all the stakeholders of the company. Referring to the goals, strategic choice and stakeholder management in pluralistic context, it should be noted that the management of Zenos should initiate goals that not only fulfill their monetary requirements but also the qualitative requirements of the company (Friis, Holmgren, and Eskildsen 2016). Further the strategic choice that the organization should make should reflect the pluralistic decision making process of the company. The choice made by management of Zenos should be suitable for all the people connected to the company. Lastly, stakeholder management can be implemented if the management understand the needs of the stakeholders of the company. In response which the pluralistic strategy initiated by Zenos should align the interest of all the stakeholders of the company.
Performance management refers to the activities initiated by the management that ensures that the employees of the company are consistently meeting goals in an efficient and effective manner. This aspect focus on the overall performance of the organization along with the individual performance of the employees. The management of the company successfully manage the internal performance of the company which reflect growth in the external market. The name of the company in the external market is always taken as a high performance organization that is consistently working to achieve the best for them. This aspect state that the performance of the employees is properly monitored and deviations are evaluated resolved at the same time so that the competitors cannot take advantage of this. Further, the employees of the company are also satisfied because they management remunerate them for their efforts inputted. Resulting to which performance is gradually managed through an inward approach (Belton 2017).
Below mentioned are the strategic recommendations for the company Zenos Cars:
Conclusion
Thus, in the limelight of above mentioned events it should be noted that the company Zenos Cars is successfully running in the target market. The company has a experience of seven years that is negligible in front of other companies present in the same industry. Still the company is running properly in the market. The above mentioned report successfully depicted the strategic analysis of the company using different models and frameworks. The report also evaluated the strategic position of the company along with the strategic choice in pluralistic context. The company Zenos is using adequate strategies that is helping them to leading in the target market and create differentiation through their products as well.
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