Documente Academic
Documente Profesional
Documente Cultură
MBA (1.5)
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ACKNOWLEDGEMENT
In the start we are thankful to Allah Almighty, who is the most Beneficent and most Merciful
We are also really thankful to our Honorable adviser Sir Suleman Anwar who instruct us
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Table of Contents
Acknowledgment………………………………………………………………………………...2
Executive Summary………………………………………………………………………………5
Industry Profile……………………………………………………………………………...........6
Introduction………………………………………………………………………………………7
Mission Vision……………………………………………………………………………………8
External Factor………………………………………………………………………………......10
PESTLE…………………………………………………………………………………………12
Hofstede………………………………………………………………………………………...28
EFE Matrix…………..………………………………………………………………………….33
CPM…………………………………………………………………………………………….33
Internal Audit…………………………………………………………………………………...36
Management Functions…………………………………………………………………….........39
Use of MIS……………………………………………………………………………………....41
Marketing Audit………………………………………………………………………………....42
Operational Audit……………………………………………………………………………….44
IFE Matrix………………………………………………………………………………………47
Matching Stage…………………………………………………………………………………48
BCG Matrix…………………………………………………………………………………….49
IE Matrix…………………………………………………………………………………….…51
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SPACE Matrix………………………………………………………………………………….51
Grand Matrix…………………………………………………………………………………....55
QSPM…………………………………………………………………………………………...56
Strategy Framework…………………………………………………………………………….57
Conclusion……………………………………………………………………………………...60
Bibliography…………………………………………………………………………………….61
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Executive Summary
I choose Bester Melamine Industry for the project of Strategic Management in which I tell
about different level in organizations. The Melamine product manufacturing sector until know in
growth stage. Although, the concept of manufacturing melamine products target to reach current
target group as well as higher middle class people, corporate sector and exporting internationally.
But it’s the critical assignment of creating the appropriate culture and educating the customers
about the quality and design of our products will be the first supremacy of our business. We will
differentiate our product by verify improved quality than the market is helping now but at lower
cost because of our new technology at the price that market is demanding. We focus on attractive
design and also work on customization to snatch the higher middle class people. The advantage
we got from this project is the exposure of Environmental scanning and Strategy Formulation
and knowing that how the Strategic concepts are used in the industries.
Report started with the brief introduction of the company and industry after that I do External
Audit of the industry to find out Opportunities and Threats for the company, and then I move to
internal audit of the company to identify company inner Strength and Weaknesses. I also take a
benefit from this Opportunity to refine our abilities in business Quantitative and Qualitative
techniques and Matrices. In matching stage I made different matrixes like TWOS, BCG, SPACE,
GRAND Matrix and QSPM. In the end of the report, major elements of a roadmap are
recommended for the expansion of a successful melamine industry.
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Industry Profile
Production of Plastic in Worldwide:
Plastics are used in a broad variety of products and have abolished other materials, such as wood,
metal, and glass. It can be set up into polyesters for use in fabrics and textiles, polyvinylidene
chloride for food packaging, and polycarbonates for eyeglasses and compact discs, between
thousand of other uses. The production of plastic is quite energy through, requiring 62 to 108
mega joules of energy per kilogram based on U.S efficiency averages. Producing silicon can
need up to 235 mega joules per kilogram of material. In 2017, the global production of plastics
attained 348 million metric tons, with 64 million metric tons generate in Europe alone.
China is one of the largest producers of plastics in the world, accounting for more than one
quarter of the global production. Plastic import from China into the United States is continuously
increasing as China’s plastic industry grows. Production of Plastics in China will carry on
developing and including more effective companies that produce strong quality plastics.
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Selected Business: Bester Melamine Industry
Manufacturing Business
Key Products:
Dinnerware
Introduction
Bester Melamine Industry is produce different types of Melamine products to add various kinds
of customers in the dining table. It will be a Sole proprietorship based company at this time.
Decision making only depend on one person.
Industry starts by Asfaq Aslam in 2017 with less capital and low type of quality product in
starting. But at this time quality will be improve day by day. Melamine industry is a growing
industry and it has a lot of export opportunities in future. Bester melamine starts with 3 machines
and 10 to 15 workers. But at this time industry improve our products so his purchase 2 more
machines and hire more workers. Our company will attain a huge success in respect of sales
amount and market share a very short time due to its product quality and pricing.
Major Customers:
Metro Melamine in Lahore
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Vision:
We focus on providing our customer with healthy and innovative products and also supply our
products in all over the Pakistan.
Mission:
We only focus at this time to provide a best quality of melamine product and earn profit through
Innovation and we concentrate on public image and build a strong relation with suppliers.
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Part I
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External Factor
Environmental Analysis
In Pakistan plastic industry is one of the oldest in the country and it’s actually can be discover
out even in 1947 when Pakistan came into being. In this modern era a world except plastic is
unbelievable. The Plastic industry of Pakistan has seen a stunning average annual growth rate of
around 15% during the last four years against a global average of 8% even with severe technical
institutional obstacle.
In 1988, plastics Technology center (PTC) was established by The FEDRAL CHEMICALS &
CERAMICS COOPERATION LIMIED in Karachi. With the startup of the centre in October,
Polymer sciences education begins in Pakistan, which later on supplies highly qualified and
skilled manpower to the Plastic industry.
The period from 1965-1975 was remarkable the turning point, where the use of plastics was seen
emerging to a leading force in the country, with a sizeable base. The plastic industry in Pakistan
has taken great step in seeking for its success.
Today Plastic material develop as the fourth largest item of imports and this sector only
contributes importantly to the national treasury in different heads. The industry is growing at an
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annual average of 15% and in the operation of development it has improve on all other industrial
sectors. The per capita consumption in the country has also proved an upward tendency during
the last 15 years (except post 9/11 events and stand draw with India). Today the domestic
consumption of plastics stands at 2.7 kg’s much less than the international average, however
Pakistan is the second largest domestic market in South East Asia after India.
Polyethylene (PE)
Polypropylene (PP)
Polystyrene (PS)
Polyvinyl Chloride (PVC)
Polyethylene (PE)
PE is used to make household articles, packaging film, automotive and industrial parts.
Polypropylene (PP)
PP is mostly used form of woven bags, household articles, furniture and packaging film.
Polystyrene (PS)
PS is used to make electrical and electronic parts, household articles, automotive parts and
packaging materials.
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Plastic unit in Provinces
3%
7%
punjab
Sindh
30%
NWFP
60% Balochistan
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Pakistan Plastic Manufacturer Association:
The Pakistan Plastic Manufacturer Association was established to safeguard the interests of
plastic Manufacturers in Pakistan during 1980s. PPMA registered in 1982 under the Trade
Organization Ordinance 1961. The main objectives were to protect, promote, supporting and
developing the plastic processing industry in Pakistan and grow the production standards of its
member enterprises. The Association often holds certain seminars, trainings and Annual
Exhibitions. (Opportunity)
Trade Policy:
This section is fewer to formulate and implement various trade policy initiatives announced
annually by the Ministry of Commerce. Proposals are generate after consultation with various
stakeholders for consideration by Ministry of Commerce. The scheme announced in the Trade
Policy is then implemented and business procedures of schemes are worked out. In order to
design a proper implementation mechanism and to install an effective evaluation system, a close
coordination and liaison with Pakistani Missions/Consulates/Embassies abroad, is established
that not only enables the smooth flow of the processes involved but also ensures transparency of
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the schemes. Because of trade policies our industry works out also improve and diversified our
export market. (Opportunity)
Industrial sector growth rate is recorded 6.80% (2015 to 2016).Industrial sector recorded growth
in (2015 to 2016)13.10% against the growth of 6.24% last year. In melamine industries growth
rate 15% in 2018, where 600-700 Medium size and 5300 Small Medium Enterprises are added in
the system. In Manufacturing growth is registered 5.00% during this fiscal year as compared to
3.90% last year.
GDP Effect:
GDP from Manufacturing in Pakistan increased to 1572948 PKR Million in 2017 from 1494169
PKR Million in 2016. GDP From Manufacturing in Pakistan averaged 1293890.92 PKR Million
from 2006 until 2017, reaching an all time high of 1572948 PKR Million in 2017 and a record
low of 1065323 PKR Million in 2006.In 2017 contribution of GDP given to the industries are
17.94%. (Opportunity)
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Economy Effect on Small businesses:
The economy can also effect on melamine because Pakistan is slow economy country and it can
affect local and small type of businesses. A slow profit flow can make it difficult for local type
of business to repay creditors and it can be negatively impact its long term validity. Taxes and
governmental spending which ultimately effect on economy. (Threat)
Inflation Rate
Pakistan Annually Inflation is relieve to a three month low 6.17% in December 2018 from 6.50%
in 2017.Inflation rate effect on melamine industries because prices will be increase and decrease
in the purchasing value of money. On a monthly basis, consumer prices went down 0.41 percent,
following a 0.11% gain in November. Inflation Rate in Pakistan averaged 7.75% from 1957 until
2018, reaching an all time high of 37.81% in December of 1973 and a record low of -10.32
percent in February of 1959.The annually variation rate of CPI in December 2018 was 6.2%.It
will be effect on consumer purchasing because of rising in the prices consumer avoid droves.
(Threat)
Unemployment Rate:
Unemployment Rate in Pakistan continues to exist unchanged at 5.90 percent in 2017 from 5.90
percent in 2016. Rate of Unemployment in Pakistan averaged 5.49 percent from 1985 until 2017,
reaching an all time high of 7.80 percent in 2002 and a record low of 3.10 percent in 1987.
Industry can hire as many workers as we want and at low cost. But it’s an opportunity for the
industry because they can hire low priced labor.
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Energy Crisis
Shortage of energy it will affect too much in to smaller firms. While all large type of firms have
alternative arrangements, so they disturb a small firms the hardest due to they have already low
margins. Furthermore, unscheduled and elongated load shedding cannot be sustained, causing problems
for even the major firms. The energy shortages and high costs are a major problem facing the industry. It
has hugely impacted the small- and medium-sized manufacturers. (Threat)
Consumer Spending
Consumer Spending in Pakistan rising to 10626857 PKR Million in 2017 from 9167259 PKR
Million in 2016. Consumer Spending in Pakistan averaged 6369861.94 PKR Million from 2001
until 2017, reaching an all time high of 10626857 PKR Million in 2017 and a record low of
2884021 PKR Million in 2001.(Opportunity)
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Social Effect on Melamine Industry:
Consumer life style changes day by day. The factors such as family structure, country of origin,
age, culture, and advertising have an impact on an individual’s way of thinking and ultimately on
consumers’ decision making process, where as price is associated to product. It based on three
things Opinions, attitudes, and Activities. Life style is basically connected to the consumer
behavior. In plastic melamine industry every customer wants different types of product. They
want high level involvement. (Threat)
Health Consciousness:
Mostly people are so much conscious about your health. Every customer want good quality
product so in melamine industry we can be focused on health use good type of plastic because
customer can use dinner sets in your daily routine. In this era customer are too much active so
everyone conscious about the health. (Threat)
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Increasing Number of families
In Pakistan number of families is increasing day by day due to lot of marriages. The total
population of Punjab in 2017 is 29924 million and in 2016 population of Punjab rate is 29.6
million. Family expand so the family of the needs is also increasing day by day and the every
family basic need is using the utensils in daily life routine so it will be Opportunity to
producing more industries.
Automation:
In this era almost industries use automatic procedures and customer like this process companies
to replace human production lines with entirely machine ones. Automation process can reduce
costs for manufacturing businesses. Because of this melamine production increased.
(Opportunity)
New Products:
Customer attracts because of new products and if you want a survival in the market so focused
on innovations. (Opportunity)
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Research and Development:
R&D is very important factor of every industry. Research and development expenditure (% of
GDP) in Pakistan was recorded at 0.24554 % in 2015, according to the World Bank collection of
development indicators, compiled from officially recognized sources. The industry needs to
improving the quality of its products, upgrade the technology used, and encourage effective
Research and Development (R&D) in order to compete internationally. By this change in trend,
industries need to come up with creative and variety of fashionable products in markets. It is a
threat for our melamine industry to produce variety of products that will cover the increasing
demand of society according to the trend. (Threat)
Security Law:
Social security welfare is also very important as it provides to workers health, education and
others. Government is providing opportunities to the companies to provide benefits like old
age benefits, disability benefits, pension, and etc. "those benefits are to be provided by every
company under the supervision of Social Security Ordinance. The company is bound to
follow the worker’s safety regulations as laid down by the worker’s safety act. THE
PROVINCIAL EMPLOYEES’ SOCIAL SECURITY ORDINANCE, 1965. All the labor
payments and interface with government must be restricted to one window. (Opportunity)
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Environmental Protection Law:
PEPA (Punjab Environmental Protection Act) aims to protect environment and human health. It
is basic legislative tool allow the government to frame regulation for environment protection.
The Pakistan Environmental Protection Act 1997 was passed by the National Assembly of
Pakistan on September 3, 1997. It’s established under the section 5. In 2012 PEPA 1997
amended. It aims to protect environment and human health. Although, number of action were
taken which included notification of NEQS in 1993 for municipal and liquid industrial effluents
and industrial gaseous emissions, motor vehicle exhaust, and noise. It’s threat for every industry.
(Threat)
Plastic utensils are basic need of every customer. If natural disaster occurs or any other problem
arises in climate so it will not affect on the melamine industries. (Opportunity)
Environmental factors belong to the health and safety your product is safe or not and material of
your product is good or bad because your customer is so conscious about the health. It can affect
because melamine customer is too much conscious about your health. (Threat)
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PESTLE Impact Matrix’s
Economical
Industry Plastic Industrial sector
Growth Rate manufacturing
unit is
growth is
increasing and
increasing Small Medium
enterprises
manufacturing is
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also increasing.
GDP Effect GDP from In 2017 GDP
manufacturing
is increasing
contribution are
recorded 17.94% it
has increased from
previous year
capturing more
market
Unemployment Unemployment Companies can hire
too much workers
Rate existing
unchanged
at low cost.
Price imported raw
material had risen in
the international
market. Working on
Economies of scale
Energy Crisis Shortage of Another
energy effect arrangements
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Social
Life Style and Consumer Consumer
buying habits
changes
lifestyle
connected to want high
level of
the consumer involvement
behavior company has
to identify
needs
accordingly
Innovation in
designs and
products
Health At this time Customers are
Conscious customer too much
preferring
good quality in
active so the
involvement
every product of customer is
so high.
Increasing Increasing in More selling
Number of population so of Melamine
the needs of the
Families
consumer is More profit
Growth
also increasing
opportunity
Technological
Focus of Customers Technologic direct
Technological are too much effect on businesses
efforts fast so
technology
will also
improve
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Automation Ease their Reduce the cost of
work and Manufacturing.
industry’s
work can be
made swiftly
and smoothly.
New Products Innovation Customer stay for
effect our
businesses
long term
Legal
Security Law Its included Turnover will be less
old age and company work
goes quietly because
benefits,
disability
bringing new workers
increase cost of giving
benefits,
knowledge.
pension.
Environmental Construction of Betterment of the
environment,
Protection factories
prevention and
Law outside the control of pollution,
promotion of
residential area
Sustainable
development,
Environmental
Climate It will not Company
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Changes affect on
melamine
production will
not stop because it
industries basic needs off
ever customer
Health and
Safety
Product is
safe or not
Consumer is too
much Health
Conscious.
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Porter 5 forces model
Bester Melamine Industry
Barriers to entry: (Low)
Our Company starts recently in 2017 so it’s the new firm and not achieves the breakeven point at
this time. Brand identity is too much matter for new industries because the competitors build a
strong relationship. Barriers to entry are low because anyone can start the business of melamine.
Fix cost is also major threat for the theme the business and the only few populations have
resources and ability to run their business quietly. It’s the basic need of every person so anyone
can start it. Our industry is local so we mostly compete with local industries. In Gujranwala
there are many melamine industries some are compared on prices and others giving a superior
quality. So we are focused on less prices, design and uniqueness from others.
In melamine industry buyer can easily find substitutes because mostly people don’t like plastic
dinner ware they thoughts plastic use in dinner set is not a good quality so they mostly use
another diner ware like pathar set. But some of the customers only use plastic dinner ware so
they don’t want to move on other substitutes because plastic dinner ware is available in fewer
prices.
Our buyer is khan trader in Gujranwala, Refique International Trader in Faisalabad so they
always purchase dinnerware in bulk quantity and so the bargaining power of buyer is high.
Mostly buyers switching cost is not so high because they can only switching for one month
because they want to change but it’s not for so long time. Switching cost is high because many
transactions based on credit bases so customer cannot switch.
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Bargaining power of Supplier: (Low)
Our bargaining power is low because supplies for the industry come mainly from Karachi at the
bulk quantity. In the case of supplies customer can easily switch from one supplier to the other so
because of this switching cost is low. There is too much store of raw material which we purchase
the plastic powder. Mostly our supplies come locally from Karachi.
If Dollar prices is high then prices of melamine diner set is also high. It depends on fluctuating of
the dollar prices. When we start a company quality is not so good at this time our quality is
improving day by day at the demand of customer. It’s the basic need of customer so the
competition is so high so the exit barriers are so high. In our industry product are not
differentiate so substitutes can easily available.
Barriers to Entry
Threat of Substitutes
$ $ $
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Hofstede Cultural Model
In Pakistan
Power Distance:
Low power distance is present; managers and subordinates have classless relationships with
access to near equal levels of power. In business, it defines itself through a manager supporting
relationship. Power distance is defined as the extent to which the less powerful members of
organization and institutions within a country expect and accept that power is distributed
unequally. In our industry power distance is clearly seen because company all decision taken by
owner. In power distance “Someone who is my subordinate today May be my Boss tomorrow or
May be my Boss on a particular project”
Power distance score in Pakistan bases on 55, it is not possible to determine a priority for
Pakistan in this dimension.
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Individualism- Collectivism:
This aspect has impacts on the company as they are manufacturing the process of production.
Collectivism is commonly observed in Pakistan. So individualism based on 14% in Pakistan. The
basic issue addressed by this dimension is the degree of interdependence a society maintains
among its members. But in Pakistan collectivist society’s people belong to joint families so they
want to live in group and they take care each other and loyal. It’s belonging to long term
commitment to the member and live be that a family or extended relationships. Society
encourages strong relationships where everyone takes responsibility for equal members of their
group. In collectivism employer and employee relationship are like a family.
Masculinity:
In Masculinity dimensions approach to do things. In Pakistan it scores 50% in this dimension and
it cannot be said if Pakistan has a preference to Masculinity of femininity. In this trait traditional
view and cultural supports included. A high masculinity performance is too much important. If
high score on this dimension show that the society will be driven by competition, achievement
and success, best in field a value system that starts in throughout organizational life. A low
masculinity so its focus on social adaptation performance and dominant values in society are
caring for others and quality of life. The fundamental issue here is what motivates people,
wanting to be the best (Masculine) or liking what you do (Feminine).
Uncertainty Avoidance:
In this dimension Pakistan scores 70% it belongs to highly uncertainty avoider. Try to avoid
every situation. In our industry people avoid every situation and tolerant level is too much low in
every employee. Countries display high Uncertainty Avoidance maintain hard codes of belief
and behavior and are intolerant of strange behavior and ideas. It based on favoritism someone
like more and he achieving highly importance of your Boss. Uncertainty avoidance has to do
with the way that a society compromise with the fact that the future can never be studied. In
these cultures there is an emotional need for rules time is money, people have inner desire to be
busy and work hard, and punctuality are the norm, security is an important element in individual
motivation.
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Long Term Orientation:
In this dimension Pakistan gain score 50%, the culture of Pakistan cannot be said to indicate a
priority. It’s connected to the past, future, and current actions. A short term orientation
dimensions show that traditions are admired and kept, while steadfastness is valued. A long term
orientation dimensions view adaptation and indirect, sensible problem solving as a basic. A poor
country that is short term oriented usually has little to no economic development, while long
term oriented countries continue to expand to a point. It describes how every society has to
maintain some links with its own past while allocate with the different task of the present and
future, and societies emphasize these two relating to the existence goals differently.
Indulgence:
In this dimensions Pakistan gain score 0% because he did not like involvement. Pakistan gains
extremely low score because it’s restrained society so employee role is so strict in every industry.
It belongs to strict social norms. Status objects are important. Restrained societies do not put
much importance on leisure time and control the fulfillment of their desires. People with this
orientation have the perception that their actions are restrained by social norms and feel
indulging them is somewhat wrong. But without socialization we did not become Human. This
dimension is defined as the size to which people try to control their desires and notion based on
the way they were raised.
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Porter
Diamond Model
In Melamine Sector has become vital role in manufacturing crowd with a lot of potential for
making economic value. Yet, it could never realize its true potential, and most of the businesses
are still sole proprietorships, and have been handling by the same family over decades. Our
business is also belonging to single owner based industry. This factor is affiliated to the way in
which an organization is organized and managed, its corporate objectives and assessing of rivalry
within its own organizational culture. Our company is not so established and in Gujranwala there
are so many Melamine Industries as compare too Lahore there are so many industries run.
Domestic rivalry and the nonstop search for competitive advantage within a nation can help our
industries to achieve advantages on an international scale.
Demand Condition:
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In this factor success of a market also rely on the presence of suppliers and linked industries
within a section. Competitive suppliers augment innovation and internationalization. Our
organization is newly started so it could be beneficial for related or supporting organization.
According to competitiveness framework presented above the culture of local customers is a
vital reason why companies are forced to innovate and then succeed abroad. But in Plastic
industry this factor is strong as the industry is aiming to compete in segments where there is
strong local demand. The level of culture the local demand has become slightly improved as
incomes have risen in recent times and consumers have started demanding hygienic products.
Pakistan is currently catering for the low to medium end of the demand market.
Industry changing technologies and techniques will continue to shape the factory of the future. It
is essential that manufacturers include both innovation and continuous improvement over time.
Two types of plastic produces in Pakistan
(1) Thermoplastic
(2) Thermosetting Plastic
The main supporting industries for Plastic industries Commodity plastics comprise of
Polyethylene (PE), Polypropylene (PP), Polyvinyl Chloride (PVC) and Polystyrene. Ancillary
equipment and manufacturers a broad range of equipment such as blenders, dryers, dosing
equipment, hopper loaders, and conveyors. In industries having no capacity to support linked to
the industry which can work on product designs, product development, quality and standards and
marketing of products.
Factor Markets:
In this it’s a situation of a country relating to production factors like knowledge and
infrastructure. These are linked factors for competitiveness in particular industries. In
Gujranwala unemployment is so high so labor cost is so less because labor will be easily
available. But as compare to Pakistan in the behalf of technology usage, we see many difficulty
and awareness of local customer in regard of certification and health issues. The main factor
point out at this time it’s including quality of education, health facilities, and cleaning facilities
32
need to boost in these cities for them to compete on superior terms in Global value chains. The
Plastic industry also shortage in competitiveness due to insufficient of specialized factors such as
modern technology, training institutes and research centers. The availability of capital is not only
difficult but also expensive.
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Strong business relations 0.10 2 0.20 3 0.30
Own distributors 0.05 2 0.10 3 0.15
Customer retention 0.10 2 0.20 2 0.20
Trust of customers 0.15 2 0.30 2 0.30
Totals 1.00 1.83 2.55
Interpretation
Horizontal & Vertical Analysis
Horizontal Analysis
Generally, the company is trying to respond to market share. The international market carries a
huge chunk of opportunities of demand, which can be helpful in building customer trust. Quality
is what company takes over the efficiency of operations and the supply chain.
Vertical Analysis
Bester Melamine is competing well in the industry on average, however, if company focuses on
distribution channels and customer retention, would become a competitive advantage.
Ratings:
1 – Poor 3 – Above Average
2 – Below Average 4 – Superior
The total weighted score of Year 1 is 1.83 it was too low because product quality is not so good
and customer will not be satisfied. But in Year 2 are 2.55 because quality of product is increasing
last year shows that company is responding above average to its external factors. They are trying
to snatch maximum opportunities available there and avoiding the threats to their best.
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P
a
rt
I
I
35
Internal Audit
Corporate Goals
36
To cover most geographic area including Pakistan and internationally
Quality
Style
37
Good Communication with Customer
It is strength for the company because it creates a positive image and effects profitability.
Stories:
Bester Melamine starts in 2017 by Single owner they start with less capital and low quality
product. When they start quality is not good so people tell the stories to other in negative sense.
At this time our industries stories are often told to the employees to motivate them normally.
Owner and employees share the stories based on their past experience. Although stories are
related to something innovative but in beater Melamine Industry they use stories to motivate the
employees, to promote them and to get engaged to the work more than employees.
Symbol:
Symbols are the objects, acts and cues that are used in the Bester Melamine Industry. In our
industry main focus on quality because our product base on quality. They keep checking each
other and every stage is so strength for the company. Machine area side they used some danger
Management style:
Bester Melamine industry has a dependable management style the decisions are made by owner
and flow of communication is downward. Because the owner give the direction to the labor
about target and they follow the direction. The dress code they follow is informal.
Confidential Information:
All the employees keep the industry information on its site and should not make copies of
documents, papers, statements and record for an illegal use. In our industry it’s a positive sign
because the company data is kept secret so that no one can easily access the key operations and
suitable of the company, so it’s not possible to copy or to attack on it in strategic way.
Competitive Advantage:
38
In our industry we give a benefit to the workers and customers also value our labor and customer
as well. Our industry is manufacturing industry so we focus on Quality on their competitive
advantage because they mainly focus on quality there are big colossus in the industry and their
production capacity is improving. In our industry owner work how to increase the company
profit?
Management Functions
39
Planning:
The first functions of management are planning. In our industry owner create a detailed action
plan target at some organizational goal. Owner controls all the planning that involves setting
objectives and deciding action for achieving those objectives. It allows the organization to run
smartly. Bester melamine also has made some plans for the future they also have make plans for
the inferior situations. Planning includes strategic planning, tactical planning and operational
planning.
Organizing:
Bester Melamine Industry have organized that what tasks and duty to consign the employees
with the particular skill sets needed to complete the tasks. The organizing function of Bester
Melamine Industry controls by the Ashfaq Aslam. As they have been working on the tasks and
responsibilities of the task manager, they have been responsible for dealing with the specific
tasks. The goals to be achieved are organized in such a way that the objectives should be
completed.
Staffing:
40
The staffing function of management in Bester Melamine Industries controls all recruitment and
personnel needs of the organization. Staffing has assumed greater importance in the recent years
due to advancement of technology, increasing in size of business, complexity of human behavior.
They hire the right labor for the every type of machines.
Leading:
In this Function we talk about leading process in Bester Melamine Industry all the labors lead by
only Owner. Supervisor means owner watching the labor and providing direction of work and
workers. Motivate the employee with inspiring behavior and also giving a positive, negative,
monetary, non monetary, incentives may be used for this purpose.
Controlling:
In Bester Melamine they mostly used Concrete Control in this during the process you take a
feedback of labors in random form. So owner can easily understand the problems of every
employee and it should be control also. All the employee and workers are control by the owner.
Owner is analyzing the sales and performance of the employees.
Management Audit
In our Industry only owner takes management decisions so we can say that it is a centralized
decision making. It’s extremely efficient regarding business decisions business owner develop all
management functions. The labor morale is high because of the company is paying proper wages
to the employees. They don’t give a reward in proper sense just give salaries to the labor. The
labor turnover and absenteeism is low because they are satisfied with their jobs because of this
purpose they do some activity in every Thursday they give a proper lunch.
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Management Function Audit
Use of MIS
In our Bester Melamine industry mostly manual system are used because labor are not so
educated only MIS used by owner. But they don’t provide any training workshop for managing
the information.
MIS Audit
No Weakness
Do all workers in the industry use the information
system to make decisions?
Is there is a proper department to manage all systems No Weakness
separately?
Is there regularly regard a Data and information? No Weakness
Do managers from all areas of the industry contribute to No Strength
the information system?
Are strategists of the firm with the information systems Yes Strength
of rival firms?
Is the information system user-friendly? No Weakness
Marketing Audit:
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In our industry marketing audit based customer demands are changing day by day so they
focusing to capture a market what customer actually want? In our industry segments are not
properly defined because it has a small business and they not require.
They have not using any promotion tool it just based on mouth advertisement it’s not so reliable
because some time negativity occur due to this. In our industry price is low as compare to
competitor because we newly start a business. It’s a major weakness our workers don't know
about the usage of technology so it all done by owner.
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this time it will be improve. Financial ratios are not good but the current ratios are excellent as
they have fewer liabilities.
They said that they sell 7000 to 10000 Dinner set in monthly. The average profit is 200 to 400 to
selling one Dinner Set. So we take their annual sale is 7000×12 =84000 Dinner Set and
84000×1000=84000000 Set If we multiply with Rs.200 Profit than the Gross Profit is 168000000
And if we take out the production Expenses, Admin and Selling Expenses than we get the Net
Profit by visiting their production area, store room and office we assume their all expenses which
are round about 8,00,00,000 and the Net Profit is =10,00,00,000/ almost.
By visiting the plant and their all business properties like office and warehouses we assume their
Total Assets are near by 500 million rupees. In addition, they have No Liabilities They purchase
the Raw Material and other products on Cash basis.
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Operation Audit
In Bester Melamine Industry only owner office consist and work place provide because there
main focus on manufacturing of Dinner set. Operations are in good condition quality will be
check in daily basis because owner round the work place are and provide instruction in daily
basis.
Process Flow
Raw Meterials
Machining
Assembling And
Inspection
Printing
Pakaging
Raw Material:
Raw material mostly import from Karachi and Lahore plastic powder import from Karachi and
Printing of dinner set styles are operated in Noshehra Road Gujranwala and readymade
packaging take from Gatay Wali Market near Bypass. Bester melamine not makes packaging it’s
the weakness of the company.
Capacity
These decisions include forecasting, aggregate scheduling, scheduling, and capacity planning.
Bester Melamine Industry manufactures 8000 to 11000 Dinner set monthly but sometime they do
not utilize full capacity.
Inventory
In inventory, 50 to 100 diner set are always in the warehouse for emergency deals or to meet
some critical situations like electricity shortage and order late delivery.
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Quality
These decisions are aimed at ensuring that high quality goods and services are produced by
caring for quality control, sampling, testing, quality assurance and cost control. But in Bester
Melamine they still work on improving the product quality.
Yes Strength
Are supplies of raw materials and subassemblies reliable and
reasonable?
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Value Chain Analysis
Bester Melamine Industry is private industry but it registered in Gujranwala Chamber of
commerce.
Primary Activities:
Primary activities are most directly related to the production and distribution of the industry
products and services, which create value for the customer.
Inbound logistics:
Bester Melamine Industry they receive order in Bulk quantity after that they prove on it. Its
include receiving and store materials for distribution and production. In our Industry is a proper
inventory store for raw materials and finished products. They import Plastic powder from
Karachi.
Operations:
In our Industry different operation run for accomplishes their productivity. They produce
different quality goods for our customers and premise the delivery in time. The company
operations are so good at present and utilizing all of its resources and their continue effort is to
ensure quality at each level. They have different types of Dinner set like local and as well as
imported Set to provide good products to their customers or improving productiveness of
operations.
Outbound logistics:
Outbound logistics refers to store and distributing finished products. They mostly use manual
system for each and everything. When everything is finalized process then final Diner set send to
the customers according to their demands.
Bester Melamine Industry also knows that labor play vital role to stand any organization.
Without happy employees no one can survive as well as not be able to attain their efficiency with
maximizing profit. In Bester Melamine Industry manager assure that all employees are satisfied
and happy.
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Firm infrastructure
They have informal infrastructure and not invested much in their infrastructure and commercial
farming so their firm infrastructure is not good because only one person handle each and
everything.
Bester Melamine Internal Factor Evaluation Company performing average (IFE) Rate is 2.75.
Ratings:
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MATCHING STAGE
(Internal Strength matching with External Opportunity)
TWOS Matrix
Internal Factor STRENGHTS WEAKNESSES
Market Strategically Located Usage of Technology
Information System not
Appropriate Price
Friendly
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BCG Matrix
High Question
Star Mark
Plates Plastic Trays
Market
Growth
Cash Flow
Dog
Dinner Set
Low
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Plastic Plates
Trays
Dinner Set
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Internal External Matrix
IFE Matrix Scores
In Bester Melamine Industry EFE Score is 2.70 and IFE Matrix score is 2.75 therefore Internal
External Matrix falls on Average so its consist in IV Cell its mean Average score. The Industry
should take in growth and build different strategies and it’s communicated to use market
development and product development strategies.
SPACE MATRIX
SPACE Matrix is another important stage 2 matching tool. Its four-quadrant framework specifies
whether aggressive, conservative, defensive or competitive strategies are most appropriate for a
given organization.
The axes of the SPACE Matrix show up two internal dimensions (financial position (FP) and
competitive position (CP) and two external dimensions (Environmental Stability (ES) and
industry position (IP).
Quadrant 1
Conservative
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Market Penetration
Market Development
Product Development
Related Diversification
Quadrant 2
Aggressive
Defensive
Retrenchment
Divestiture
Liquidation
Quadrant 4
Competitive
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SPACE Matrix
Financial Position
Working Capital +4
Short Term Assets +3
Return on Asset +3
Total: +10
Industry Position
Total: +12
Competitive Position
Total: -11
Environmental Stability
Tough Competition -2
Change in Govt. rules and regulations -3
Rate of Inflation -4
Unemployment Rate -2
Total: -11
Average scores:
FP = 10/3 = 3.33
IP = 12/3 = 4
CP = -11/3 = -3.66
ES = -11/4 = -2.75
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FP
Conservative Aggressive
+6
+5
+4
+3
+2
+1
CP IP
-6 -5 -4 -3 -2 -1 -1 +1 +2 +3 +4 +5 +6
-2
-3
-4
-5
Defensive -6 Competitive
Es
In space matrix, we have observed that company will run after aggressive strategies. We consider
they key factors of Financial Strengths, Industry Strengths, Competitive Advantages and
Environmental Stability. By assigning them values as per their importance defeat to best, we
calculated the score, which lead us to the decision that company will pursue Aggressive
strategies. I would suggest Market Development and Product Development strategies will work
best for Bester Melamine.
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Grand Matrix
Quadrant II Quadrant I
Weak Strong
Competitive Competitive
Position Position
The Grand matrix helps us to determine the strategy that should be pursued, based on its
competitive position and market growth.
Bester Melamine Industry have strong competitive position against its major competitors and the
market growth is healthy and at increasing speed.
However, they still need to do lot to get themselves at top. As per my opinion, they fall under
Quadrant 1 and they should follow aggressive strategies like Market Development and Product
Development.
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QSPM(Quantitative Strategic Planning Matrix)
Market Development Product
Development
External Factors Weight Attractive Total Attractive Total
Score Score
Lahore Chamber of Commerce 0.10 4 0.40 4 0.40
and Industry
Consumer Spending Increase 0.06 3 0.18 3 0.18
Innovative Products 0.08 4 0.32 3 0.24
Bargaining Power of Supplier 0.04 3 0.12 3 0.12
Low
Energy Crisis 0.08 3 0.24 4 0.32
Lack of R&D 0.06 4 0.24 3 0.18
Increased Operational Cost 0.08 3 0.24 4 0.24
Internal Factors
Market Strategically Located 0.08 3 0.24 4 0.32
Appropriate Price 0.10 3 0.30 4 0.40
Proper distribution channel 0.06 3 0.18 4 0.24
Employee Morale 0.02 3 0.06 4 0.08
Information System Not 0.06 4 0.24 4 0.24
Friendly
Reward System Not Effective 0.04 3 0.12 4 0.16
No Advertisement 0.04 3 0.12 3 0.12
Contrasting both Market Development and Product Development, we gain more weighted
attractive score for Product development. That means company should follow the product
development, which is part of aggressive strategies. This strategy is going to help the firm in
removing its threats and catch the opportunities to be successful in the present macro
environment.
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Part III
Strategy Framework
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Strategy Framework
EFE: 2.70
IFE: 2.75
Star: Plates
Dog: None
QSPM Matrix:
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Problems Areas
Only one office consists in this industry and also work place.
No formal records are maintained in the collection keeping process.
Readymade packaging using at this time.
The production area is not so reliable so labor disturbs to do work in Machines.
No any accountant to clear all accounts problem.
In production department, the workers are not so skillful.
Strategic recommendations:
Product development is the selected strategy at this point of time for Bester Melamine Industry
that we observed from our strategic analysis of the firm.
In product development strategy, I propose the company to focus on having the high level of
product performance, the high level of functionality or functions, the new technology or the
highest level of product innovation, for which they need skilled and experienced worker. One
major setback to the company is not targeting the suburban areas and no strong chain of
distributers.
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Conclusion
In this all working (internal and external audit, checklists, matrices, analysis) the company
should do product development and try to snatch the market share in new markets and in this
way it would be an easy to making research and development department because when there
will be activities like this then it would be easy to implement the strategies. In addition, it is not
the end part, and then company has to control it and evaluate it for further success of strategy
because a control and evaluation will play essential role for not only implementation but also for
the next strategic move.
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Bibliography
https://www.pct.edu/business/plastics-innovation-resource-center/global-standards-for-plastics-
certification
http://www.pakplas.com.pk/about.php
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http://plastipacpakistan.com/industrial-structure-of-pakistan/
https://www.statista.com/statistics/383256/pakistan-gdp-distribution-across-economic-sectors/
https://tradingeconomics.com/pakistan/consumer-spending
http://indiapopulation2018.in/population-of-punjab-2018.html
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warned-5-october-2015/
http://punjablaws.gov.pk/laws/187.html
http://www.tdap.gov.pk/trade-policy.php
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https://www.hofstede-insights.com/country/pakistan/
http://atozplastics.com/upload/Literature/pakistan.asp
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