Question

An electronic company is facing a problem of declining market share due to increased competition from other new and existing players in the market. Its competitors are introducing lower price models for mass consumers. Who are price sensitive? For quality conscious consumers company is introducing new model with added features and new technological advancements.
(i) Prepare a model business plan for this company. Specify which type of plan you are preparing.
(ii) Identify the limitations of such plans.
(iii) How will you remove these limitations?

Answer 1

The type of plan needed to be prepared under this situation is strategy and the steps involved in preparing this plan are:
(a) Setting up of objective: The company may set up a long term objective of capturing more and more quality conscious consumers or becoming a leader in quality and trend setter in market by one year time.
(b) Adopting a particular course of action: The company must import latest technology or spend more or research and development department to innovate latest technology to make their goods superior than competitor's goods
(c) Allocating resources for achieving the objectives. Company must take permission for importing technology and must allocate extra funds to their R and D section and appoint people with latest knowledge to innovate new technology.
(ii) The common limitations are
(a) It may involve huge costs
(b) It is time consuming process
(c) There is no guarantee of success
(d) It may not fit in dynamic environment.
(iii) To overcome these problems
(a) Prepare budget to carry on this plan and function within the revenue allocated in the budget
(b) Fix a time limit to achieve the plan and then to execute the plan within that time limit only.
(c) Scan the environment properly before implementing the plan
(d) Use the plan with caution and care.