Friday, 28 September 2012

MBA Essay - Implementing Strategies

This assignment answer is framed around {Removed} Distribution Limited (ADL). ADL was formed in 2001 to distribute a new range of Samsung branded compatible laser and inkjet supplies products to the reseller channel. It is a small entrepreneurial business and currently has three employees; these being a sales manager, account manager / administrative assistant and a warehouse manager.
The market that ADL operates in is mature; characterised as almost “perfect competition” and thus could easily be viewed as a “zero sum game”. Acquisition of new business mainly involves the targeting and transference of existing trade away from competitors to ADL. ADL’s competitive advantage previously, was to focus on the brand strength of the Samsung name, in the hope that this would allow them to position the range at a price premium to its competitors. This was done in an attempt to avoid the sort of margin erosion that so often occurs in a mature market and in the hope that this type of market positioning would enable a higher conversion rate of new resellers thus leading to accelerated growth.
Whilst ADL has enjoyed some considerable success with the above approach, it is still failing to meet it’s key performance targets and whilst it’s shareholders remain committed to the business, questions are now being asked of it’s management as to why performance is not improving at the required rate.
ADL is failing to meet its objectives in a number of key areas. The most critical being:

1. Performance against revenue targets.
2. Performance against profit targets.
3. Acquisition of new customers.
4. ADL is losing money at the rate of 5K per month.
5. Stock turnover is lower than expected

Which objectives to choose and why?
The choosing of objectives raises a number of questions, examples of which could be:
1. Whose stakeholder interests are best served within the choosing of the above five?
2. Other stakeholders, such as staff, could have other problems that may have an impact on the current level of performance, which are not being addressed by focusing on any of the above five.

Ultimately, the shareholders of ADL chose objectives 1,2 and 3 as the three key objectives to initially focus on because it was felt that unless ADL could improve it’s sales and revenue performance and attract enough new prospects, the company would not be able to improve it’s cash burn rate. Whilst ADL recognised that employees may have other concerns that were not reflected in the choosing of these core objectives the general consensus was, that unless the company was fundamentally profitable, the viability of the whole business would be in question and the ultimate effect on all it’s stakeholders would be obvious.
Having identified which objectives to focus on, the management of ADL were given four months (due to expire at the end of December 2003) to show an improvement in the performance of the company.

Questions for consideration
The identification of ways of improvement it could be argued, could be said to be dependent on a number of fundamental questions. Some of which could be...

1. What business is ADL actually in? In other words, are they just a supplier of FMCG products or should they be something different?
2. Are ADL clear about where they are now and where they want to be?
3. What is the measure of success?
4. What is ADL’s locus of control are they a voluntaristic or deterministic type of company?
5. Having identified the need for change, will there be a willingness on behalf of personnel at the point of delivery to actually implement the change?
6. Do ADL have the right Structure, Systems, Process’s and Culture to deliver any required changes?
7. What sort of change and implementation strategy will be required? Radical as opposed to Incremental, Continuous as opposed to Discontinuous or something completely different?
8. What sort of leadership behaviour will it take to deliver the required changes – Transformational or Transactional, a mixture of the two or something completely different?
9. Individuals often appear to prefer a degree of homeostasis, are {Removed} prepared to accept that any change may make their people feel uncomfortable and the subsequent problems this may cause?
10. Organisational change may result in short term inefficiencies – how will the company deal with this?
11. Is {Removed} looking for commitment or compliance from its people?
12. Management often assume that strategy making is done in a vacuum. There is a danger that any organisational changes made by ADL may ultimately not produce the required results. This may happen as a result of competitors in ADL commercial environment implementing strategies that counteract any improvements achieved as a result of the ADL change, or indeed, the wider environment as a whole may have changed to such an extent that it makes any actual improvements on ADL’s part, ineffective.
13. How will {Removed} deal with resistance amongst staff, should it occur?

Strategy for Improvement
Lawrie J Mullins in his book “Management and Organisational Behaviour, Sixth Edition, Prentice Hall, p825” cites Elliot who comments... “Change is a complex psychological event, managing change places emphasis on employee and customer needs as the highest priority.” This appears to differ from Kotters view in his “eight stage change process” who commented “One should encourage change by spreading dissatisfaction within the organisation” This could raise the question – what is the right approach to setting the implementation strategy? As managers, managing through people and managing interactions are often, part of the everyday approach to doing business. Whilst on the face of it, “spreading dissatisfaction throughout the workforce” may make sense; there could be inherent dangers in having, for example, a sales force of dissatisfied workers with a low morale. However, it could also be an acknowledgment on Kotters part, that dissatisfaction and low morale are a natural consequence of any substantial change process and perhaps the key managerial concept when that type of change process is required, is to accept that there will be forces of resistance and the most effective way of dealing with it when appropriate, is to implement change quickly in an attempt to minimise the effects on both internal and external customers.
The management and shareholders of {Removed} recognised that, whilst change had to take place and whilst they viewed the change as a crisis response, that it was important to ensure that effects on both customers and employee’s were minimised as much as possible and as a result, they therefore adopted the following measurable approach.

Vision Statement
“ADL are not in the distribution business they are in the business of improving the profitability of their reseller partners”.

Grand Strategy
To accelerate sales and ensure that the company meets its 2003 forecast of 618K. To achieve this by focusing on a cost leadership position relative to its competitors.
To review ADL cost base, primarily focusing on costs of sales, in an attempt to improve profitability by 5%. Operational Goals – to be implemented by end of August Meeting Sales forecast of 618K

1. Acquisition of 30 new accounts with a minimum spend of 5K each.
2. Current conversion rate of new customers is one in twenty, improve to one in ten.
3. Increase sales within existing accounts from an average of 3K per month to 5K.

Cost Leadership Focus
1. Identification of the {Removed} value chain in relation to competitors to identify whether there are possible areas of improvement.
2. Undertake an analysis of our competitors pricing and attempt to position the {Removed} pricing lower to enable sales to target competitors more aggressively.
3. Evaluate options to establish whether {Removed} can create a sustainable competitive advantage to retain customers when competitors respond to this new strategy.

Functional Goals to support the above
1. Using the {Removed} database, develop a targeted marketing campaign to target the top three thousand resellers in the UK via fax and email. Allowing for a 1% response rate, this could yield, thirty good quality accounts @ 5K each.
2. Undertake a gap analysis to analyse the {Removed} product range vis a vis competitors. Work with suppliers and manufacturers to ensure that ADL have the right product set with which to target prospects and support their existing customers.
3. Analysis of competitors accounts coupled with market knowledge, may yield whether ADL can improve its purchasing position and thereby obtain a reduction in cost pricing. ADL’s target was a reduction in cost pricing by 5%. If this could be achieved, the additional gross profit, taken across the year should ADL hit 618K, would be 30.9K. If this could be done this alone would eradicate the cash burn and contribute towards bringing {Removed} into profit.

Areas requiring change to facilitate above strategy
Before embarking on this, it is worth summarising the managements thought processes before undertaking this change approach. Perception of environment in which this decision was made – crisis. In certain organisations, it could be argued perhaps, that managers may not have viewed the current situation as a crisis but as an “opportunity” instead and approached the situation from an entirely different perspective. Rather than looking at a “radical” perspective to change they may have used a somewhat different approach, veering more to methodologies such as “logical incrementalism”, Evolutionary or a “continuous learning” approach in an attempt to achieve the desired outcome instead.

It could also be argued that, as the market {Removed} operate in is mature, that to some extent ADL are constrained by its external environment and that they should therefore adopt a more deterministic approach. However, the management of ADL felt that, as ADL has already proved, the organisation can grow in a mature market and has achieved that by being intensely pro-active and success driven. A voluntaristic approach would therefore support the

current change strategy more appropriately, as this would represent the internal ethos as espoused by staff. Type of leadership required for change – largely transformational but with a strong ability to micro manage. It is worth noting that ADL is made up of only three people. The shareholders of ADL follow the “Theory X” view of motivational theory, articulated by Douglas McGregor. That is, that people essentially want to do a good job and do not need senior management telling them what to do but rather, that the team had suffered from a lack of adequate support, especially when it came to looking at internal practices and procedures and that a manager that could reduce the burden in this area and streamline the process would be more effective in supporting the team and helping them achieve their full potential. This was felt to be more appropriate than a manager that was autocratic and bureaucratic. Style of leadership required – Participative but with a contingency view.
Thus accepting that a coercive style of management could be used if it was necessary to achieve desired result. The management team however, recognise the importance of obtaining “buy in” from those involved. Whilst a crisis approach, by its very nature, implies change without negotiation, there seemed little to be gained in achieving an outcome, which ultimately, could break the psychological contract between staff and the organisation. This could result in staff not implementing, or even, sabotaging attempts to implement change. Ultimately, it is often the personnel in the front line who deliver success as they are the interface between the customer and the company, it is therefore important that as much as realistically possible, given the particular type of situation faced by the company, coupled with the prevailing culture, attitudes, beliefs etc, that key staff are given every opportunity and support to commit to the change objective.

The key areas
Because of the nature of the change, the management of ADL recognised that this would be a top down approach. However, the management team acknowledged that to be successful, the change would also need to be bottom up and supported by all personnel.
“Ultimately, leading change is a shared responsibility of everyone in an organisation, from top to bottom. The whole organisation must pull in the same direction. If the whole organisation is not aligned with the change effort, the effort will fail (2606/7 Implementing strategies, Module 3, pp 1.8, edition 13, Learning Resources, 2002).
The following are key areas that may need to be addressed as part of the initial process. Implementation Approach (2606/7 Implementing Strategies, Module 3, pp 1.17, edition 13, Learning Resources, 2002)

(A) Establish the need for change.
(B) Form a powerful lead team.
(C) Create the vision.
(D) Communicate this to all parties.
(E) Empower people to act.
(F) Plan for and create quick wins.
(G) Consolidate improvements and use them to develop more change.
(H) Institutionalise the new systems.

Possible critique of the above Implementation strategic approach
If this is a crisis response, why the above approach for change and why not just implement from the top? Often it could be argued, that change strategies do not fail because of bad planning or indeed, necessarily bad execution. They fail because there may not have been enough consideration given to overcoming the forces of resistance and obtaining “buy in” from the people involved in the process. Forces of resistance will be covered in greater depth later.

Establishing a need for change
It could be argued that unless individuals are aware of the need to change, they will not accept change. Change, as mentioned earlier, often impacts on the homeostasis of an individual. The more the person is aware of the reason for change, the more likelihood that they may accept it. This is a fair viewpoint and may be the case. However, another viewpoint is that the more information an individual has, the greater likelihood that they may act in there own self-interest. For example, a critical employee, in this case the sales manager, could, on understanding that the company has four months to turn things around, may just as easily look for another source of employment rather than buy into the change programme. This could perhaps mortally wound the project before it has even started to be implemented.
How much is communicated at this particular stage, may well be determinant on the situation and the make up of the individuals that are being faced with the problem.
Form a powerful lead team. It is perhaps easier, in {Removed}’s case, to form a strong lead team, as the organisation has only a small number of staff and the ethos of the business has always been to attempt to empower people and share views, opinions and ideas. If the organisation were larger however and the situation was similarly viewed as a crisis, the approach may need to be somewhat different; perhaps by bringing in external managers, in an attempt to divorce the current management from the process and thereby creating a somewhat fresh perspective. This may be even more relevant if the current management team were somewhat associated with the current state of affairs that the company were experiencing.

Communicate the vision
The textbooks argue that everyone needs to understand the vision and why this is a good thing. How can you be absolutely sure though, that this has actually occurred? Often, change fails because individuals become disengaged from the process as a result of not buying into the concept. Is that a failure of the communication of the vision or the effect of an individual’s own subjective view of the world in which they live? Even the best communication of the requirements to change may fail to impress those that are unwilling to listen.

Empower People to Act
McClelland argues that effective leaders empower their people to act. What happens however, if the people expected to deliver the change do not want the empowerment and increased level of responsibility that this may bring? In ADL’s case, two out of the three employees’ are nearing retirement. There is no certainty that these two individuals would want that additional involvement or increased responsibility. They both may well do an excellent job already but want no more than their normal pay cheque at the end of each month.
The key areas that may require change continued...

1. Lines of reporting
(a) Is the business structured in the right way?
(b) Is it too hierarchical, too bureaucratic or should it be even more empowering?
2. Management style
(a) Are the management too Task or too role orientated?
(b) Is the current management style too autocratic, laisre fayre or democratic?
(c) Do current management have the necessary skills to improve performance?
(d) Do they know why they do the things they do?
(e) Does current management lead? And if so, are the team prepared to follow?
3. Skills
(a) Do staff have the right skills?
(b) Is greater training required to help staff improve their own performance?
(c) Is staff able and willing to learn new skills?
(d) Are they equipped, not just to deal with the now but also with the future?
4. Technical competencies
(a) Intention to de-skill or re-skill?
5. Policies & Procedures
(a) Are there clear guidelines in place?
(b) Do staff have the right framework to support their business activities?
(c) Is staff capable and willing to set their own guidelines or do they need management to facilitate the process?
(d) Does their line manager support staff?
1. Information Technology
(a) Does IT empower staff or dis-empower?
(b) Is IT used to streamline business processes or does it add to them?
(c) Is there the right system in place or could it be improved?
(d) How can IT be used to improve performance and empower staff better?
(e) If IT can be improved, how much would it cost and can the business in its current state, bear the burden?
2. Logistics
(a) Does logistics staff have the right training and equipment?
(b) Can the warehousing function be improved to improve stock rotation and the cost of stock holding?
(c) Can the business move more into a “just in time” methodology of stock management? And if so, would this improve things?
1. Work flows
(a) Can current process be improved?
(b) Why do staff perform the routines that they do? Is it because it is the best way or is it because that’s the way it has always been done?
2. Staff Interactions
(a) Do staff interact well?
(b) Is there a mutual sharing and understanding of roles between staff or are roles just performed based on division of labour and specialisation?
1. What is the culture?
(a) Power, Role, Task or Individual? (Handy, C)
(b) Adaptive, Clan?
(c) Something different?
2. Does the culture support the change strategy or is it likely to impede it?
(a) If culture is grounded in values, practices and behavioural norms that match what is needed for good strategic execution, this may help energise people throughout the company to do their jobs in a strategy supportive manner (Thompson / Strickland, Crafting and Executing strategy, McGraw & Hill, Twelfth Edition, pp 413)
(b) If it does not, what approach needs to be applied to change it?
3. Is the culture strong within the company or weak?
(a) If strong – why?
(b) If weak – why?
4. Is there an inward looking culture or are staff willing to accept a different approach to doing things?
(a) What values do the staff hold?
(b) How has the culture developed?

5. Attitudinal and Behavioural approach.
(a) What are the attitudes & behaviours of key personnel?
(a) Is it congruent with the change process?
(b) If not, why is it the way it is and what needs to be done to change it?
Resistors to change
Why do people often resist change? There appears to be a number of reasons which could include.
(a) An individuals own subjective view of the world in which they live.
(b) The degree to which the individual feels the organisation has supported them previously.
(c) The level of commitment that an individual feels towards the organisation as a whole or for the task that they do.
(d) The psychological contract between the individual and the organisation.
(e) A desire to “go along with the group”. This may well influence individuals, even if often, they may not share the same view themselves.
(f) A misunderstanding of the reason for change.
(g) A loss of personal status.
(h) The fear of learning new skills and possible failure to master them.
(i) A fear of losing benefits and rights.
(j) A fear of having to assume greater responsibility.

Change strategy
The type of change approach employed may depend very much on the urgency of the situation at hand and on the level of need for the commitment of others. For example, it is possible, that any radical strategy employed as a result of the tragedy of the September 11th attacks may have been met with little or no resistance, because the crisis that prompted the strategy was of such a magnitude, that it out weighed any potential concerns that individuals may have had. Examples of possible change strategies (2606/7 Implementing Strategies, Module 3, pp 1.12 – 1.17, edition 13, Learning Resources, 2002):

Education and Communication
Where there may be a lack of understanding, this may help individuals to focus on why change is necessary. It could be argued that once an individual is aware of the need for change they are more likely to commit to it. A competing point of view perhaps is that once an individual is aware of the reason for change, they may not commit to it and lose commitment to the organisation far more quickly than if they had not been made aware of it in the first place. They may look outside the organisation for other opportunities and be more vocal in their anti policy view and destroy any possible commitment by others as a result. Education and communication is also a slow medium and may not always be possible if change is required in response to a crisis state.

Participation and Involvement
This may allow those whose ”buy in” is sought from management, to feel that they have a degree of ownership in the change plan. It also allows the management team to draw on the expert knowledge of key staff. Possible drawbacks to this approach again are, that this may take time and would not necessarily be a suitable response to a crisis.

Explicit and Implicit Coercion
This could be used where the crisis pre-emting this approach, requires a radical and quick response and is of such a magnitude that the cost in terms of the breaking of any psychological contract between the people and the organisation is outweighed by the cost of delay or inaction. Possible advantages of this approach is that in presenting individuals with a fait accompli, they are likely to overcome any resistance more readily and internalise the new process’s and working patterns more quickly. Possible disadvantages are that individuals will only appear, to adopt to this new way of working and have less commitment to the organisation in the long term as a result.

Force Field Analysis
Involves identification of the individual’s reasons for resistance to the change, in the hope that in certain situations, these objections can be overcome and turned into drivers for the commitment to change.

Change approach employed in the {Removed} situation
A mixture of Education and Communication, followed by participation and involvement. Why? Because management recognised that whilst the change was viewed as a crisis, that it required its people to deliver the change and that therefore, whilst it may take slightly longer to implement, there was less likelihood of resistance and more chance of success with this type of approach.

In {Removed}’s case the management team felt that the existing sales manager, whilst extremely effective and competent in most areas of the business, did not have the necessary skill set to lead the changes. The board however, did acknowledge that the sales manager was key to successful implementation and the ongoing management of the business. The board decided to entrust the responsibility for delivering the strategy to another board member, who had experience in this field and who already, commanded a high degree of respect from the ADL team. Using a participative approach but mindful that coercion could be used but only if absolutely necessary; the representative of the board met with the sales manager and “together” they drafted an action plan.
This action plan then took on the following steps.

1. Presented to other members of the ADL team.
2. Together, concerns were raised.
3. These were identified and where appropriate overcome.
4. Where it was not possible to overcome, the management used the “price of non-conformance approach” to illustrate the problems of not changing.
5. As much as possible the strategy drawn up by the board was then “sold” to the team as their own and they were given ownership, under the guidance of the board representative to deliver it.
6. A review process was put in place to measure performance against pre-determined targets and ensure ongoing commitment to the plan.
7. As an aside and unbeknown to the sales manager and his team, the board also had a contingency plan in place to deal with the situation arising of the sales manager or any other member of the team not supporting the change process.

In concluding the assignment it should not be forgotten that this change approach applied to a very small business, where the staff have all been with the organisation, almost from inception. The culture, existing management style and personnel make up of the individuals made it more likely that they would in the main, be responsive to change. Also, because of the flat management structure of the business, it was also likely that any possible resistance could have been dealt with quickly to ensure that it did not affect other team members. Would this type of implementation strategy have worked if applied to a business, the size and structure of an Marks and Spencer? Possibly. Would the approach have had to be different? Definitely. Had the size of the organisation been larger, more fragmented and diverse, It is likely that there would have been greater unease amongst staff and less likelihood of any resistance being dealt with quickly. This would possibly be due to the hierarchical nature within these type of businesses and the ability of line management to effectively relay feedback up and down the chain of command. This may have the effect of slowing down communication and thereby allowing concerns to fester and permeate throughout the organisation.
In terms of communication also, it is not always possible to get large numbers of personnel into one room and therefore, the reasons for change are communicated along several different channels. This, combined with the “internal grapevine” may mean that the message can get lost or metamorphose along the route. The nature and type of approach to take is therefore likely to be contingent within the environment in which the decision is being made. What may work in one situation and result in the desired outcome may produce entirely the opposite in the next.

Daft, Richard L. Management, Sixth Edition (2003), Thomson South Western.
Handy, C. Understanding Organisations, Fourth Edition (1993), Penguin.
Mullins, Laurie J. Management and Organisational Behaviour, Sixth Edition (2002), Prentice Hall.
Thompson / Strickland. Crafting and Executing Strategy (2001). Twelfth Edition, Mcgraw Hill.
{Removed} of {Removed} (2002), MBA, 2606/7 Implementing Strategies Module 3, Edition 13, Learning Resources.
De Wit, Bob. & Meyer, Ron. Strategy Process, Content, Context, 2nd edition (1998), Thomson.

Tuesday, 25 September 2012

Essay - Strategic Analysis of Tata Group

1. Introduction
Tata Group is one of the most renowned and prominent business groups in India. Tata Group is comprised of 96 functioning enterprises which fall under seven different business sectors. Undoubtedly, this group stands as a giant in the business community of India. Tata Group has now expanded its operations in more than 54 countries. This group has spread its network worldwide catering the needs of consumers everywhere. As a result, this group is gaining more popularity in specific countries where they have started their business, some of which include UK, Bangladesh, Vietnam and USA. After their successful operation in India, Tata group is making every effort to penetrate in the international market. It is imperative to analyze their business strategy which is not possible without conducting a thorough SWOT analysis, PESTEL, reviewing their business model and investigating their strategic position. However, it is important to conduct an in-depth analysis in order to get an idea why Tata group is adopting the trend of acquiring the status of internationalization for their business group.

Cultures and Values
According to Stacy (1993), successful companies emphasize on giving the best to their customers without violating their traditional beliefs and cultural values. Their decision making process revolves around putting the cultural values and beliefs ahead of their own advantages. Likewise, Tata Group has emphasized on giving the best to their customers. The group has always strived hard in ameliorating the standard and quality of life of their customers. Tata group has played an effective role in strengthening the economy, quality of life and improving the standard of living of people in India. Over the years, Tata Group has successfully gained the credibility among the masses both in India and at the international level. According to Porter, it is impossible for a business to grow or attain a successful stable position in the market without recognizing, adopting or implementing the set of core values and beliefs. However, recognition and adoption of the core values and beliefs are not solely the key factors while analyzing the success of a business entity. There are some other essential factors as well that play an important role in determining the success of a business group.

2. SWOT Analysis of the Tata Group
SWOT analysis helps in developing and implementing some of the most effective business strategies that enables the organization to understand its corporate needs. According to Johnson (2005), a SWOT analysis helps an organization to analyze and evaluate the key corporate issues as well as it also helps an organization to assess its strategic strength and how well it can make an impact on its strategic development. However, Doole and Lowe (2008) have defined SWOT analysis as strengths and weaknesses of an organization which are obtained after a thorough analysis of the resources and capabilities present in a firm. This analysis also highlights the opportunities and threats that a firm could encounter from its external environment. However, it is important for an organization to develop a strategic plan that should highlight its strengths and opportunities, eliminate the threats and help the organization to overcome weakness:

• Specialized and experienced in seven major industries.
• Strong micro environment
• Clear company vision with a strong culture
• Availability of resources
• Reliance on weak distribution network
• Lack of innovation in value chains
• Presence of unstable macro-environment
• Emergence of new markets with strong and stable economies
• Opportunity for inventing new products and meeting the customers’ demands
• Exports
• Increased global mergers and acquisitions can open unlimited opportunities for Tata Group
• Political uncertainty, corruption and crime is a real threat
• Fluctuation in currency rates
• Fuel price rise could impact on the transportation and operation cost
• Presence of free markets
• Price sensitive consumers are least loyal and could switch to low price products/ brands

3. Strategic Intent
Sutherland and Canwell (2004) describe strategic intent as a driving force that pushes the organization to meet its pre-defined and pre-determined set of goals and objectives. Currently, Tata Group has focused its strategic intent towards the acquisition and merger of different firms globally. Tata group has broadened its strategic intent towards acquiring the international status for their group which can make a deeper impact on other firms and businesses in the international market. Their focus is to expand the limit of their business group and to attain an international position in the global markets. Their main strength lies in their business of steel and they see it as an opportunity to invest in steel industry because of its high demand in the global market. Tata Group is well aware of the fact that they can penetrate the international market with the lowest possible prices as compared to their competitors. This would also help the Tata Group to overcome its weakness of poor distribution network for exporting its steel items and other raw material to foreign markets. Recently, using their key strength factor i.e. “experience”; Tata Group has successfully entered in the UK market through its acquisition of “Tetley Group” and “Corus Steel”. This acquisition helped the group to strengthen its business roots in UK market and to maximize its market share. However, Tata Group needs to focus on establishing a set of value drivers, ensure the availability of its resources and strategic capabilities that would help the firm to retain its market position globally. This can be further explained through a simple example of their strategic plan implemented effectively in UK market. For example, the strategic choice analysis of car segment of Tata Group of Industries reveals the strategic approach of one of the India’s biggest automobile manufacturers into the UK car market. According to 2006 data monitor, despite the fact the global demand of cars have fallen significantly, still sales of commercial and utility vehicle demand has risen satisfactory. Socio cultural forces exerts an influence which increases the demand of more fashionable SUV and sports type cars in US and UK car market (Windecker, 2005). Tata’s strategic decision to enter into the UK market is based on several factors. These factors include getting a favourable status of India from the UK trade ministry, being a part of a dynamic UK car market and reducing the language barrier with UK customers. Tata group has to face numerous factors externally and internally during its entry into UK car market and Tata had designed a strategy to address the broad competitive environment, direction of development and then adopted the method of development in such a compatible way which played a vital role in the success of Tata group in UK car market (Currimbhoy, 2004). Not only in car market segment, Tata Group is still working on paving its way in other segments as well in UK and other foreign markets.

4. PESTEL Analysis of Tata Group
PESTEL analysis stands for political, environmental, social, technological, economic, and legal analysis of any industry. It’ importance can be gauge by considering Pareto Principle, that indicates that 20% of the factors included in the PESTLE analysis has 80% impact on business activities (Wit & Meyer, 1998).

Political Factors
Political factors are most critical as a company has to revise its rules according to the political environment of the country they are going to operate in. Major activities that are directly affected by political environment include operational cost, supply chain management and competition policy. Political instability could result in slow economic growth. Therefore, it is important for the group to carefully determine the political stability of the country before entering it. It is evident that when there is a political agreement to operate in a certain country, then there will be certain benefits for both parties like (homeland of the company and the country where the company wants to extend its business) reduced tariff and non-tariff barriers. This would also benefit the Group in its cross-border operations.

Economic Factors
Economic factors play an important role in determining the economic growth of the country. It also tells about the consumers purchase behaviour. A country facing recession and economic meltdown would not be an ideal to penetrate for starting business operations for the Tata Group as compared to a country with a stable and has a sound market. After its recession in 2008, the UK economy is reviving speedily. One of the most favourable conditions from the investor’s point of view is the strong position of British pound against other currencies. It minimizes the risk factors and hence attracts investors to invest their money safely.

Social Factors
Social factors refer to lifestyle, social activities, customer trends, buying and spending habits of customer etc. Social factors are critical for an organization as they need to know that what kind of product will be appreciated by the customers, if appreciated, do they have purchasing power to purchase your product etc. Tata Group emphasized on these factors before penetrating in the car industry of the UK. In the UK, family cars are not in demand and hence this is the result of the lifestyle of the people living in the UK. They prefer to buy SUVs and luxury cars, so the growth trend can be observed towards the luxury car segment (Veloso & Kumar, 2002).

Technological Factors
Technological factor is also very critical from the organizational perspective as well as from the consumer’s perspective. Internet is one of the most important technological factors as it opens new transactional potentials, managing and operating prospects such as marketing mix, ecommerce, global market targeting, market research and targeting exact segments in low cost. Tata Group is also considering the importance of technological aspects (Currimbhoy, 2004).

5. Resource and Strategic Capabilities
Tata Group is effectively using its tangible and intangible resources to survive in the international markets. Their strategy is obvious from the Group’s recent acquisition of Daimler Chrysler. According to Ritcher (2007), Tata Group is determined to beat the other competitors out of the race. Tata Group has focused on providing quality products to their customers which is the company’s core value. The strategic capability of Tata Group lies in “Cost Efficiency.” There are several factors that contribute in building the cost efficiency of a company. These factors can be the product design, the experience of the company, supply network cost or the economies of scale (Robson, 1997). Furthermore, we cannot underestimate the profit pool segments of Tata group which helped the company to become a market leader today. Such profit pool segments include its automobile industry, technology sector, and pharmaceutical and chemical sector. Tata Group is striving hard to expand its profit pool segments and to use them as its strategic capability. This strategy would help the company to penetrate into the international market with their increased demand in Africa, Latin America and East Asia.

6. Tata’s Strategic Position
The future of an organization can be outlined by analyzing its strategic position in the market. The strategic position of an organization can be well analyzed by applying Porters SWOT analysis or BCG Matrix (Boston Consultant Group Matrix). In figure 1, the BCG matrix is representing the industries that yield a huge market share to the company but with a slow growth. These are known as “Cash Cows” for the Tata Group and this include the steel, power, oil and gas industries whereas on the other hand, the matrix also represents the industries with equally low growth and market share. Such industries are referred here as “Dogs” for the Tata Group and include Tata entertainment industry (Tata Sky and other Tata Tele Services). The BCG Matrix also represents the stars that indicate the industries with equally high market share and growth. Such industries include automobile industry, tea and chemical sector. However, each industry in the BCG Matrix is itself an opportunity for the company to get into a business opportunity with other firms (Moore, & Pareek, 2009). This can be further explained as the “Cash Cows” represent the Tata’s acquisition with the Corus which yielded a huge market share to the Group. Similarly, the “Stars” represent another Tata’s acquisition of the Korean automobile company, Daewoo. Through this acquisition, the Group has acquired a high market share.

Tata Group is focused on acquiring the position of a global brand in the international market. It is highly imperative for the Group to understand the future position of the firm in the international market along with how the Group can strategically avail the opportunities present in international market and how it can overcome threats.

7. Porter’s Five Forces Analysis
According to Porter (1980), there are five forces that drive a competition between the organizations in different industries. These forces determine the success of any organization.

1- Rivalry among existing competitors:
Tata Group is always faced by a strong competition both at domestic and international level. Domestically in India, Tata Group is faced by a tough competition from its old competitor - the Reliance Group. On the other hand, at international level, Tata Group encounters tough competitors like Ford and General Motors in automobile industry and by Brazilian steel company known as Companhia Siderurgica Nacional. This Brazilian steel company is well known for placing its bid on acquiring the Corus against the bid placed by Tata Group.
2-Threats of New Entrants:
Tata Group holds a strong market position in the international market. Therefore, the chances are rare that any new entrant in the international market can affect the existing position of Tata Group in the market. Tata Group holds a major market share in the most profitable international industries like steel and automobile in both UK and Korean markets that are known for their profitability and business feasibility in the world.
3- Bargaining Power of Buyers:
The bargaining power of buyers is lower because Tata Group has focused on giving the quality products to their customers at lower prices as compared to other businesses. Tata Nano is the example of Tata Group’s strategy in providing quality product to the customers at a lower cost.
4- Bargaining Power of Suppliers:
Tata Group needs to focus on improving its suppliers and distribution channel to allow more exports abroad. The bargaining power of suppliers is higher due to poor transport infrastructure and other uncertain conditions.
5- Threat of Substitute Products or Services:
Tata Group holds a strong market position in the international market. Tata Group focuses on the company’s core value that has emphasized on providing quality life to its customers through its products and services. Tata Group enjoys a strong relationship with its customers because of its strategy of providing the quality products to all its customers at an affordable price. Therefore, it is impossible for the loyal customers of Tata Group to switch to any other product or services with questionable quality at cheaper rates.

8. Tata’s Competitive advantage
According to Stacy (1993), Porter has described competitive advantage on two different bases:
• It can be gained on lowering the prices as compared to the rivals
• OR, it can be acquired by bringing changes to the product to make it look different from those of the rivals by adding superior and unique qualities to the product.
Tata Group has strategically used this competitive advantage in its steel industry where it has used “cost” as a tool of competitive advantage against its rivals. In automobile industry, the Tata Group has focused on acquiring the cost focused strategy. This strategy would enable the Tata Group to gain the competitive edge on its rivals who are high cost producers in the automobile industry. Tata Nano is the example of Tata Group’s cost focus strategy in the automobile industry.

9. Tata’s Value Chain Analysis
1- Inbound logistics:
Tata group focuses on building business relationships with the suppliers that have the same business value as that of the Tata Group i.e. they should focus on value and providing the high quality material to the company. This helps the group to build a life-long business relationship with its suppliers.
2- Outbound logistics:
Tata Group has chosen distribution channels which reflect the target market's buying behaviour and maximum availability of product to the target market. To maximize the product availability at market, Tata group selected contractual partner with strong dealership network. Furthermore, Tata Group has worked out on e-distribution strategy to broaden the capacity of its distribution channel (Nieuwenhuis & Wells, 2003).
3- Operations:
Tata Group has effectively used the IT systems in its operations. This has enabled the group to efficiently attain its position of low cost leadership in the market.
4- Marketing and Sales:
Tata Group focuses on targeting its customers through different promotional and marketing activities. Tata group offers low-cost high quality products; therefore they mainly focus on targeting all the segments of the society due to its cost focused strategy.
5- Service:
Tata Group provides post purchase services to its customers. They have after sales service centres which are focused on facilitating the customers with different services, customer care help and provide them assistance in getting the spare parts.

10. Conclusion
Tata group has focused on acquiring the position of international market leaders which is obvious from its international acquisitions and mergers. Tata group has implemented different strategies in different markets to gain its position as international market leaders. This group has wisely used “price” as its weapon to gain competitive advantage against its competitors and a tool for penetrating into the international markets. The company has used a “No Frill Strategy” in its oil industry which offers products at low prices, with low perceived benefits and low value additions. This strategy is specially focused to target the price sensitive segment. The group has also focused on acquiring the hybrid strategy which focuses on low prices as compared to the prices offered by the competitors while giving the same benefits on the products which are given by the competitors. Tata Group is effectively using its “low-cost” but “high-quality” strategy as its key success factor in all the international markets to gain its position as a market leader with a high market share.

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Marketing Essay - Comparison between Service Brand and Product Brand

The current era is considered the age of competition and the branding is one of the most convenient ways to establish a positive image in the mind of the consumers. However, it is rather difficult task to formulate an image without pondering upon each element that is indulged in the promulgation of some brand. Nevertheless, the brand can be promulgated if proper strategy is applied after selecting the best brand type.

This paper throws light upon the significance of brand and two types of brands. The first section is the clear cut mouthpiece of what the brand actually is and what the benefits of using this term. Furthermore, this section also throws light upon two types of brand, ie service brand and product brand. The essential features of both these types are promulgated keeping the definition of different scholars under consideration.

However, the main purpose of this paper is to present a comparison of the product brand and service brand. Both these types of brands have their own significance but a brand gets familiarity by passing through different stages, encountering several elements. The second section focuses on all those elements that contribute in the success of some product or service. The deep down comparison of both these types of brands is also presented side by side as well. However, different recommendations are also given to cope with the challenges aroused by the current competitive age for these two fields.

1. What is brand?

Before throwing light upon the product branding and service branding and making a comparison between both of them, it is essential to know what the brand actually is because the comprehensive definition of brand will aid to understand the entire concept.

Kotler et al (p.549,2005) gave a vivid description what the brand actually is. According to him, a brand is regarded as the combination of name, sign, symbol, or set of names that dissimilate some specific service or product from each other. Kapferer (2004) indicated that a brand is the source to drive consumer behavior and has capability to form decisions of consumers as well. A specific brand represents almost all the qualities and traits a specific product possesses. It has power of differentiating a product or service from each other and cause reliability from the part of consumer as well. In simple words, a brand is term, symbol, name, design, sign or a specific combination that is formulated to identify a specific service of good by the consumer due to its uniqueness.

1.1. Elements of Brand:

Either the brand is categorized as service brand or product brand, in each case; there are four elements that cause the fundamental recognition of the product. these four elements involve brand named that indicate a word that cause recognition of some product, trade name that indicate recognition through organization’s name, brand mark that indicates the logo of some brand and trade mark that indicates the symbol of the brand. In each case, the brand causes financial and social benefits not only to organization but also to consumers as well. Brands not only guarantee the quality, but also the expression of emotions as well as sophistication at the same time. The example of famous brands is best in this regard. There are many famous brands that are even working today for satisfying the consumers with their services like Rolex that indicates sex and success and Kodak that guarantees great picture quality.

1.2. Benefits Of Branding:

As far as the benefits of branding are concerned, not only consumers and manufacturers get certain advantages from the familiarity of the brand, but the retailers also get benefits as well. As far as the consumer benefit is concerned, the customer easily identifies the brand quality through its name or logo, evaluate the product features, rely on the brand quality that cause less risk and so on. As far as the manufacturer is concerned, branding builds loyalty towards customers, formulates a strong position in the market among competitors, differentiates the products that cause unique identification of the product, and power over the retailers also augments. The retailers get benefits because of the position of a specific product in the market and by attracting customers as well.

The financial benefits of the branding can be assessed through the saying of
John Stuart, “If this business were split up, I would give you the land and bricks and motors, and I would take the brands and trade marks and I would fare better than you.”(Clifton&Ahmad, pp.26, 2009). The financial value of branding, especially service brand was ambiguous from past decades. However, now the tangible and intangible sources are gathered to achieve financial benefits from the brand usage.

Brands have their social significance as well. For the complete social life, the wealth plays a vital role and this wealth can be gathered with the help of brand investment. Good consumer value means good investment, that further invites employment and selling of the goods, which ultimately benefices in the form of wealth and excellent living standards as well.

1.3. Significance Of Adopting Proper Branding Strategy:

However, the history is evident that without a proper branding strategy, none of the great brands have achieved the highest position till now. The example of Coca-Cola and Rolex is best one in this regard as they were established years ago. The Coca-Cola brand was established hundred years ago and achieved this familiarity with the passage of time. A brand, either it is service brand or product brand, takes time to achieve familiarity in the market and that’s why, almost all top brands which have significant position in the market are years old.

After throwing light upon branding and its significance, benefits and value of adopting proper strategy, now the light will be thrown upon two major types of brands, one is product brand and other is service brand.

2. Service Brand:

Before making a thorough comparison between both product and service branding, it is essential to define the meaning of service branding and its significance for complete understanding. The service is called the activities which benefice both indulged parties by the service provider who results in advantages without ownership. It is certainly intangible and always tied with the provision of some tangible product as well. A service brand is a kind of service that makes itself loyal and reliable through its service for the people. “A service brand communicates a commitment to provide a certain kind of experience for customers.”(Glynn, pp203, 2009). Most of the consumers rely upon the brands of the service but it is rather very difficult to build this kind of position in the market.

2.1. Features Of Service Brand:

There are certain features of this kind of services that makes it unique and exceptional.
Actually the brand service is not itself a tangible object but it’s a matter of performance ie renting a car, providing a platform for shopping and many more. EBay and Amazon are two most authentic examples in this regard on which, while shopping, the individual gets satisfied only because these are branded services. Second thing is that it is totally intangible which means services cannot be tasted, rotten, burn or break but the matter of fact is that without a tangible product, service branding is not possible. Only through using physical objects offered by the service branding company, the customer becomes able to comprehend the significance of the services.

It cannot be said that the standard of the service would be same because each time, the service is performed by different people even if they are working in the same firm. Sometimes the performance also differs due to day routine as well. The services also differ when different consumers demand different things and the employer become unable to fulfill the criteria.

Another exceptional feature of the brand service is that it is assessed through regular updates and through giving proper training; the staff is made able to satisfy the consumers. The staff is collaborated to gain experience and learning.

In such kind of services, the consumers are directly involved in services like in launderette and staff cooperation like in hair salon. The timely informing to the customers regarding the service provision also affects the overall consequence as well.

The consumers are not only provided direct contact with the staff, but sometimes the consumers-to-consumer contact is also brought into existence. Similarly, the services cannot be stored or restored as well. For instance, if the individual provide the services of cleaning in some house, the hour he will spend in providing service cannot be restored. There is certain time that is suggested to provide services and consumers have to act according to the timing of services. Sometimes, the individuals have to wait for long time if they want to use the service of some brand.

2.2. Role Of Employers In Success Of Service Brand:

The employers play a major role in the success of some service brands. Suppose, if the staff of the hair saloon is not capable enough to satisfy the consumer, the result will appear in the form of dissatisfaction on the part of the customer that further led him to use the service of some other saloon. Similarly, if the staff working in some organization is not cooperative, the services will receive its bad effects. Moreover, the timely provision of the service and adopting proper strategy to cope with sudden rush of the consumers also cause negative consequences for the service provider. In other words, through providing reliable, responsible, trustful, and exceptional services, the employers can augment the level of the brand in no time.

2.2. Role Of Consumer In Success Of Service Brand:

The consumers play a major role in the success of some specific services. Sometimes, it becomes really difficult to satisfy the needs of some consumer, especially in current era when the brand services are provided worldwide through IT sources. It has become really complicated to comprehend the needs of the consumers demanding services worldwide. So, if the customers are satisfies, the reliability level augments.

2.4. Challenges Service Branding Is Facing:

There are certain challenges this service brand has to face, especially in the case of global service provision. Sometimes, the communication conflict arises between the service provider company and the consumers having services of that respective brand. Similarly, the rules that are utilized to promulgate are also applied to service brands as well which becomes really difficult to manage sometime because of its being intangible by nature. Nowadays, there are many exceptional brand services that are serving consumers worldwide. So, it has become really difficult for the consumer to select the best among them. This competitive ratio is the top most challenge which the brand service companies are facing throughout the world.

3. Product Brand:

For a complete comparison, it is equally essential to keep in view what the product branding actually is. The product branding is the second type of brand which has diversity in it because the entire branding process depends upon the specific product that is being sold using some service. Basically a specific good or product manufactured by a company is promulgated using its logo, name or specific sign. The sign ensures that the product is of high quality and this assurance is generated by the past reputation of that respective company. Through the product brand position in the market, “People make decisions about which products to buy after considering both tangible and intangible attributes of a product.”(Daniel&Gitman, pp.302, 2008).

Many famous products like Pepsi, Coca-Cola, Rolex, Gucci, Armani and similar like these brands are the examples of product brand. Through providing physical goods amalgamating it with provision of sophisticated services, the brand can be made exceptional among the other competitors.

3.1. Features Of Product Branding:

Just like service branding, the product branding has its own significance as well. There are lots of features this category possesses. First of all, unlike the service brand, product brand is tangible as well as perishable. It has its physical entity and the individual can use and restore it easily. For instance, if the individual is using the branded product of Gucci, he can replace it easily with any other good.

The contribution of manufacturers, retailers and even customers can be seen in the promulgation of the product brand. Especially, the service providers play an exceptional role in promulgating some specific product. It takes long time to make a product famous and the example of Coca-Cola is the best one in this regard as it took more than 100 years to become a strong brand and there is contribution of all these three forces (ie consumer, retailer and manufacturer) in its success.

A high quality product is of no worth unless proper marketing is not applied to make it a brand. Suppose if the product is manufactured using good quality ingredients but it has no branded name, people will not trust on its authenticity only because it would have no proper marketing. Marketing makes an image of some specific product brand in the mind of the people and that’s why, people always prefer to utilize branded products instead of common one.

Unlike service brand, the product brand is perishable. It means once the product is rotten, broken or burn, it cannot be restored. Only a new product can be the replacement of the existing product. Moreover, due to the reliability of the consumer over the product brand, the product brand most often succeeds in fulfilling the expectations of the consumers as well.

3.2. Role Of Manufacturers In Success Of Product Brand:

The manufacturing of the product plays an inseparable role in the success of some product, the brand is the name of quality and the consumer demands more than a product. A brand product must be the symbol to express the emotions of the consumers. As far as the manufacturing of the product is concerned, the use of good material in the product making augments the reliability level of the consumer over the product. Moreover, the product is also an expression of feelings such as Hewlett Packard is the name of reliability and trust. So, the manufacturing plays the fundamental role in the success of some product brand.

3.3. Role Of Consumers In Success Of Product Brand:

The success of product brand also depends upon the consumers who utilize the product. the product brand is a source of assuring the consistency and quality to the people and mitigates the physical, functional, financial, psychological, social and time related risks and when the individual finds no risk in some product brand, he always prefer it over all other product brands and select the respective brand that satisfies him. The existing product brands also become the source of identifying the new product introduced in the market as well.

3.4. Challenges Product Branding Is Facing:

The current era is considered the era of competition and a single product is being sold with different brand names. So, it has become really difficult for a new brand to establish a strong position in this competitive market. Only products with high quality features can make their position strong in this competitive market and hence this competition is too tough. This competition level is not congested to merely a single region but for the big product, this completion is expanded at global level. The example of two cold drink product brand is best one in this regard. Pepsi and Coke are two most renowned companies and there is a strong competition between both these brands as well.

It is also necessary to produce such kind of product that can meet the needs of the customers. This competition has given birth to novel products and that’s why the customers’ demands have also increased. So, almost all brands are facing severe challenges in this regard.

Now after understanding what the branding, service branding and product branding is, it would be easier to make a complete analysis and comparison of product and service brand regarding the positioning, equity, audit, extension, personality, and identity. This section is basically analysis of the product and service branding and a thorough comparison between both these elements. When a new product or service is promulgated or an existing service or product strives to maintain its current position, it has to focus on certain elements of strategic management that have been promulgated by the strategists. These elements involve brand positioning, brand equity, brand personality, brand image, brand audit, and brand extension to some extent. All these major elements have been discussed along with the comparison of product and service branding and the impact of these elements over both these types.

4.1. Brand Positioning:

Brand positioning is considered as the act of formulating and image of the offer facilitated by the company so that it can achieve a unique position in the consumer’s mind.( Keller, pp.120, 2008). Actually it is an act of hitting the mind of targeted customers so that they become able to ponder upon the specific service or product in an accurate manner. It means brand positioning plays a major role in the success ratio of some specific brand; either the brand is related to the service or product.

The product brand positioning is far easier as compared to the service branding. The reason behind this fact is that there are several marketing strategies that can be adopted to promulgate some specific product brand and once the consumer tastes the flavor of a good product; he builds the trust over it. It means, it never takes long time to build reliability over customer when the question is about quality. The example of Neiva is best one in this regard. For instance, when the consumer utilizes the cosmetic if Neiva and finds it suitable for her/his skin, he/she trusts that respective product and utilizes it now and then.

Comparatively, the service brand takes long time to establish its brand positioning. The product is manufactured using the same ingredients but the matter is really different with the services as when some consumer utilizes the brand services, sometimes, the result appears in hundred percent positive response but sometimes the employers and service providers show lacking in duty that further results in lower brand positioning. The chances of poor service provision are more than poor product provision. So, for service brand, it is really hard to build brand position in the market. It takes long years to formulate reputed position in the market and the example of Google is the best one in this regard as it took long time to make itself trustworthy.

4.2.Brand Equity:

Brand equity is referred as “a set of brand assets and liabilities linked to a brand, its name and symbol, which add to or subtract from the value provided by a product or service to a firm and/or to that firm’s customers” (Aaker, 1991, p.15). Keller (1993 p.8) has defined the brand equity by indicating it an experimental learning which is employed to retain and attract customers by a brand. Brand equity includes values, either its intangible or tangible, to the brand product or services.

If the comparison of brand equity is done between service brand and product brand, it would be clear that both these types of branding strive a lot to establish brand equity. For this purpose, different brand equity models are adopted to formulate a well established position in the market ad attract the consumers as well. For establishing product brand equity, it is strongly needed to produce unique products with different kind of changes so that the customer’s loyalty can be achieved. However, it is little bit difficult as for companies as compared to the service providers who, through providing loyal, quick and quality services, can build a strong relation with their respective customers. However, for the success of some brand, it is essential to utilize strategies for establishing brand equity.

4.3. Brand Identity And Personality:

“A brand identity is a set of brand associations that the firm aspires to create and maintain.”(McLoughlin& Aaker, pp.186, 2010). The main aim of strategist is to create a sent for meet the objective suggested for the specific brand. However, there is difference between image and identity as the identity is indicated as the goal proclaimed by the strategist for the brand that is generally formulating the exceptional image of the product in the mind of the consumer.

For the success of some product or service, it is strongly recommended to set this goal so that an identity of the service or product can be made. For instance, EBay provides a quick turnaround for the people who do shopping at that platform and the identity of this platform is established through establishing brand image through brand identity. Similarly, the products of NIKE have their own identity. However, it takes time to meet the suggested goal by the products as compared to the service providers and the reason behind this fact is that the current age is regarded as the age of competition. That’s the reason why the famous but static products are loosing their identity in the market because the novel innovations are replacing them. however, the services are having little less competition comparatively because by bettering and the services and making the service reasonable and cheap, the identity is substantiated in this stream.

4.4. Brand Image:

The brand image is regarded as the current image that is formulated in the minds of the targeted consumers. this image is again made after identifying the product or services. However, it is essential to mention here that the image is formulated with the use of service or product whereas the identity is the set associated with the brand for achieving a specific goal.

Either analysis of image is done from the perspective of product or service, it is essential for both to establish a strong image in the eyes of targeted consumers as without formulating a strong image, the success of the product or service is not possible. The Coca Cola Company established its identity and now the targeted consumers consider it a good and refreshing cold drink . Similarly, the Rolex has given an image of being sexy and appealing look, so this image augments the brand equity as well. As far as the service brand image is concerned, Google has an image of the best search engine in the mind of targeted consumers, so it is utilized to search different thing by different people. This image level can be adopted only be establishing a proper set of strategy by the strategist. The more a plan is authentic, the more a brand gets success.

The image or personality is actually the conferment of the experience of the consumer which he receives after using the service or product brand. Just like human beings, the brand also has its own personality and this personality is the core element that causes its success in values and publicity. This personality provides loyalty of the consumer when the consumer expectations and the performance of the brand is equated. However, the formulation of the service personality is difficult as compared to product personality formation.

4.5. Brand Audit:

The brand audit is regarded as the basal feature of examining the product and service brands to establish brand equity. “A brand audit helps a company understand the health of its brand, identify areas of additional value, and improve brand equity.”( Solomon, Cornell&Nizan, pp.159, 2009).

When the audit of some product is done, the strength of the product, its equity and the improvement ratios is well considered. As compared to product, when the audit of the brand service is done, the health of the service, its fast forwardness, its brand equity, its demand, exploitation and improvement ratio is well pondered. It is considered the best way to know what the consumer think about the product or service. For instance, McDonalds used to do audits to know the needs, trends and aspiration of the people and make changes in their services respectively. This kind of audit is fruitful for both these types of brands as after knowing about the image of some product or service, several steps can be taken to improve the position in the market and beat the competitors. That’s why, McDonalds is considered one of the best fast food restaurant.
Brand extension and its impact on service and product brand:

Brand extension is referred as the extension of some brand beyond a specific but original category.(Lehmann, pp.273,2005). In such cases, when a new product or service takes the aid of some established product or service and treats it as its parent, it is referred as brand extension. Both kind of brand can prove fruitful in this regard.

As far as the brand extension of some product is concerned, it happens when some new product encounters complications in establishing its name and takes the aid of some existing product brand so that it can make an image in the mind of targeted consumers. The example of apple mobiles is best one in this regard in which different kinds of products are introduced keeping in the light of existing products.

Similarly when the service is provided under the name of some renowned company, the results appear in the form of satisfaction of the consumers. for instance, Yahoo gives the services of website hosting under its name, so, most of the people rely on its hosting services only because it has its own image and identity.

When both these services are merged to formulate a complete existence, the result appears in the form of well established image. For instance, if the NIKE products are being sold on the platform like Amazon or EBay, the consumer sale will be high and the value will also be high simultaneously.

5. Recommendation:

The branding has become really difficult now in this competitive age and there are several elements that the company or service providers must have to keep in mind while establishing some product or service. if the product or service is promulgated using some strategic plan, there must be certain plans to cope with certain situations as well. for instance, if there is sudden rush of customers to some service provider brand, there must be substitutive methods to cope with this kind of situation. Similarly, when the product beings to loose its identity in the market, there must be some change in it so that the change can attract not only the existing consumers but also new consumers. Several drinking production companies used to adopt this strategy to maintain their position in the market.

The amalgam of awesome service with a good quality product can bring results in the form of success and strong existence for both. A product can be marketed through the use of some renowned service providing company. This can be referred as the brand extension. However, this is the best source to maintain the doomed position in the market.

To compete with the new upcoming brands, it is essential to keep the technological advancements under consideration. History is evident that many companies loosed their position only because they did not pay attention to the basal technological advances and the result appeared in the form of their vanishing from this stream. So, by adopting novel strategies, the product and service can be bettered.

For both type of brands, the uniqueness is the key of success as the consumer always demands for the unique and catchy product and service. Even if the product or service looses grip over uniqueness, the results appear in the form of severe loss. So, either the case is related to the product or service, the uniqueness is the major element for progress. The examples of big brands are appropriate in this regard. Big competitors Pepsi and Coca-Cola are competing with each other since several decades but what had been making them exceptional from other drinks are their uniqueness and productivity. Similarly, the EBay and Amazon are considered the most trust worthy platforms even if they are competitors but they are having their strong existence only because of their unique and exceptional service. However, all the strategic elements and recommendations are essential for both these types and the improvement in the service and product quality is also considered necessary for building strong brand equity.

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Nizan, A., Cornell, L. D. & Solomon;, M. R., 2009. Launch! advertising and promotion in real time. New York: Flatworld Knowledge.

Social Stratification Essay

There rarely exists a phenomenon that could not be defined in terms of the society and social norms because the social behavior goes hand in hand with every concept associated with living things. The idea of a leader and his follower is present everywhere in every society. Whether it is the boss of a multi-national company having 200 employees underneath him or a president ruling a nation of billion individuals, whether it is the Brahmins or the Shudras in Hinduism or a beggar and a common man in any country, the distinct class difference is prevalent since a very long time. Class stratification is understood as the basic reality of every society. This concept has become the core of Sociology because of its importance and connection to the world’s economy, politics, culture and the overall well-being of individuals. Sociology is the study of society and the social behavior of individuals. In other words, the sociological perspectives analyze the different aspects governing the world.

In this regard, there are three major sociological perspectives which understand the different aspects of a society. Symbolic Interactionist perspective focuses on the minor details of life. In other words, this theory is based on the idea proposed by Weber that people interpret things on the basis of the meaning which they attach to the symbols. This meaning usually arises because of the social interaction and communication with other people. For instance, words or music can be referred to as the symbols which are interpreted differently by every individual. On the other hand, the sociological perspective known as functionalism adheres to the idea that a society has several structures which are interrelated to each other. In this way, they collectively affect the functioning and the structural well being of a society. The basic element which constitutes the overall structure includes the customs, beliefs, traditions, institutions and sectors. For instance the judiciary, the economy and the peaceful environment of a city are all interlinked. Furthermore, the third important sociological perspective is the conflict view which is typically based on the ideas generated by Karl Marx. The theory incorporates the pertaining socio-political and economical inequality in every society. However, this sociological view promotes a social change as it continuously stresses upon the rule of the dominant and how the working class is exploited at the hands of the elite ruling class (Brown K, 2006).

As mentioned before, the class stratification is not a new concept. It basically refers to the way a society is divided into different socio economic classes or income groups. The term class can be understood in a number of varying ways. For instance, class can be defined as a characteristic defining a rank on the basis of economic division. This definition can fit in for occupations as well as group descriptions associated with income levels. Similarly, despite the subjectivity of the phenomenon, the word class can also be understood on the basis of material identification and standard of living. Consequently, this reveals the existent grading class levels; lower, middle and upper class system. In addition, class can also be defined in terms of the relationship between people and their earning medium/ resource. Hence, although there are a number of ways in which the term class is defined, it is often understood as a concept of inequality (Giddens A, 2001). However, to ease out this comprehending confusion, the sociological perspectives help elaborate the way in which a structured society works on the basis of social class and stratification.

In this regard, the Marxist view addresses the concept of social class in association with the class inequality present in a capitalist society. He focuses upon the exploitation of the working class (the proletariats) by the ruling class (the bourgeoisies). For this reason Karl Marx talks about the people belonging to the lower socio economic class and poverty in general to be a result of human activity and not a natural phenomenon. The Marxist view holds the social institutions responsible for poverty and consequently encourages the transformation of these social institutions or the importance of a social change for controlling such class inequalities. Furthermore, while explaining the concept of exploitation, the Marxist view highlights the problems in the means of production that ultimately become the reason of exploiting and ruling over the working class. This arises not because of what people possess (in terms of resources) but also because of the way they utilize these resources. Hence this ultimately results in a class conflict. In this way, Marx describes a social class in relation to the link between people and their means of production. Moreover, this class difference is governed by the material interdependence between the bourgeois and the proletariat. For instance, the material welfare of the ruling class is directly connected to the economic imbalance being faced by the proletariats. Similarly, the ruling class is also at a greater benefit as the working class doesn’t own the means of production and also because the bourgeoisies take advantage of the efforts of the workers. This shows the working of class inequality in a capitalist society. For this purpose, the Marxist view promotes a social change and envisions a time of revolution when the society would be run on fair principles and everyone would be able to own the means of production. This would be the time when the oppressed class would collectively stand up and rise against the oppressors. This idea is adopted by the communist and socialist countries who do not favor the system of class stratification (Wright E, 2003).

On the other hand, the Interactionist perspective as pioneered by Max Weber views class in the following words: We may speak of a “class” when (1) a number of people have in common a specific causal component of their life chances, insofar as (2) this component is represented exclusively by economic interests in the possession of goods and opportunities for income, and (3) is represented under the conditions of the commodity or labor markets. This is “class situation” (Wright E, 2003). In other words, despite acknowledging the economic inequality dwelling in societies, unlike Marx, Weber points at the fact that social class can be better defined through life style and life chances. Life chances refer to the means of accessing the resources. This is not only limited to the economic resources but also institutions like education and health along with the ability to obtain food and shelter. Weber did not agree to the concept of dividing the classes on the basis of the ruling and working class as put forward by the Marxist view. However, Weber looks into the procedure of social stratification from a different view as compared to Marx. He considers class to be one aspect of the society’s structure where the other dimension is the status or the social honor.

In this regard, for Weber, the class difference can be understood on the basis of property ownership. In addition, the prime focus of his theory is the idea of life-chances. Ownership gives people the direct access to the market and eventually the greater material advantage. Similarly, he also focused upon the property-less class in terms of the skills they possess (Wright E, 2003). However, unlike the Marxist view, Weber is not a proponent of the idea that the class division would result in a social action. On the other hand, Weber defines status group as a community having a shared, common life style. He clarifies that although wealth may not be the only reason for describing status group, it can be considered as a key factor. This is evident from the prestige associated with wealth, as in the case of old and new money. Similarly, wealth also determines the lifestyle of individuals on which the status depends. Therefore, Weber considers the class and status to be equally associated with the concept of material inequality. The difference between them is based on the idea that the concept of class is directly linked with the material well being of individuals who bring the financial assets to the market whereas the status groups affect the economic well being of individuals in an indirect manner. Thus, Weber is seen to be less interested in the financial problems and deprived people, the ruling class being at an advantage and the class struggle that may arise in response to condition of being deprived. In contrast, he is keener in analyzing the instrumental rationality; the law and order and the practices attached to social interaction which results in creating life chances.

Furthermore, Functionalists also present a different view while talking about the social stratification and social class. In contrast to the conflict view, the functionalists view social stratification as beneficial and necessary for the functioning of a society. This is because of the idea that a class structure promotes harmony. It provides competition and an opportunity for the best to rise to the top. Furthermore, functionalists do not restrict to the economic reasons when defining the concept of social class. They consider a person’s family background, his work, education and other such facets of life to be the key determinants of their social class. In this way, they believe that poverty is not a natural law but it eventually flourishes because people do not put in an effort. In this way, the class stratification provides a platform for individuals to work hard and get the best.

This difference in the outlook of the social class is merely because of the philosophy held by the functionalists. Since they place great importance in the fact that society runs because of its interdependent sectors, the social stratification system is seen to lie on the positive spectrum. The functionalist view of social stratification is put forward by people like Emile Durkheim, Kingsley Davis and several more. Functionalists understand the concept of social stratification on the basis of human needs and desires which make them different. For this purpose, society plays an essential role in providing and also limiting goals and opportunities to the individuals. In a similar manner, the society also encourages these individuals to exercise efforts, learn and develop skills to climb the ladder. Hence, the functionalists consider the social stratification as an essential framework to develop the best individuals and motivate the most capable ones to take the best positions in order to help the society operate successfully (Saha D, 2006).

Thus, no matter how the different sociologists perceive the idea, social stratification coexists with the creation of every society. It divides the whole society into different classes and groups which can clearly be distinguished on the economic, social and political basis. For this reason, all the sociological perspectives discussed above hold a view that reflects the true nature of the society.

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Saha D, 2006, Sociology of Social Stratification, Global Vision Publishing Ho
Solon, G. 2002, Cross-country differences in intergenerational earnings mobility,
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Taylor F, 2007, Sociology: understanding a diverse society, Cengage Learning.
Weininger, Elliot B, 2002, Class and Causation in Bourdieu, Amsterdam: JAI Press.
Wright E, 2003, Social Class, Encyclopedia of Social Theory, Sage Publications.

How to Make Internet Marketing More Attractive

Internet or Web marketing makes use of the most innovative as well as continuously techniques that are characterized by the wide coverage of the World Wide Web, affordable options for promoting your services and products along with an increasing appeal related to shopping over the Web among urban consumers. Studies indicate that approximately 70% of the entire population is making use of the Web to buy services and products which are not easily available in their near premises. This actually makes Web retailing a viable option with a rich and strong customer base as well as reaching out to the prospective consumers a well planned and organized Internet marketing strategy is essential. Great festive discounts and attractive deals are normally used by most of the online retail stores. We all are aware of the fact that online stores operate 24 hours a day and 365 days every year and therefore requires to keep up the tastes and requirements of the customers to hold on to their consumer bank.Different Internet marketing techniques make use of all the mediums to promote their services and products and also try to acquire maximized visibility of their portal. Making use of social networking portals which are simply thronged by public for placing their adverts is catching up speedily.

Email Marketing
This happens to be one of the most aggressively used technique to market both services and products to advertise regarding deals in several Internet retail stores. The most vital factors that must be taken into account are to target the prospects and avoid sending emails in bulk as most of them may lead to spamming. On the other hand, you can provide your consumers with a weekly update regarding attractive discounts and offers as well as new deals that are available on several products can be useful in generating traffic to your website along with substantial sales revenue. Communicating with your consumers via email can turn out to be exceedingly instrumental while you are creating relationship which could provide you with real-time feedbacks as well as reparative sales.

Article Marketing
This technique of Article marketing is just another vital technique that is useful in making the web portal visible to the buyers. Articles and blogs with relevant keywords leading to all the products and services sold over online retail stores are practiced to a great extent. Superior quality content is generated on relevant topics by such retail stores and later is published on significant directories, publishers, sites and even newsletters to target the genuine prospects.

Forum Marketing
This is another growing approach which is useful for the online retail stores to promote their offerings. Marketing with paid forums is just a great concept as this way you will be able to reach out to your genuine prospects that make use of such forums to have a general idea regarding the products and services available over various online retail stores.

Search Engine Optimization or SEO is a technique which is helpful in improving the ranking of a web portal using several different tactics. This technique is gaining popularity to a great extent as a large number of people are flocking to online base retail stores as per their requirements.
These are some of the most commonly used techniques presently implemented in marketing such portals. On the other hand, if you are considering sustaining in this market, you need to come up with something that is more innovative while you are considering reaching out your existing as well as prospective consumers.

Incredible Benefits of Cloud Computing

Incredible Benefits of Cloud Computing
Cloud computing presents its users with a wide ray of benefits and each of the previously explained types of cloud computing comes with its specific set of benefits which are unique from a given type of cloud computing. Its thus important for any user of cloud computing to look at the different types of clouding and select the best option for his or her business in order to enjoy the maximum benefits of cloud computing.

Who can benefit from cloud computing?
Business application software provides businesses with critical data anytime it is needed which explains its popularity in large businesses as it acts as a tool of running the business smoothly. However, this kind of IT infrastructure requires huge capital outlay in order to acquire one which might not go down well with small businesses. For such people, they can only look up to the stars hoping that the clouds can save them from this technological mess. If you are such a person operating a small business, you need to give the newly reinvented technology of cloud computing a chance to provide answers for your business application and software requirements. With its highly reduced monthly subscription cost, cloud computing is the best take for delivering web based applications to small and medium sized businesses. In simple terms, cloud computing benefits millions of business owners by providing them with improved state of the art business application. Cloud computing offers its users with a lucrative opportunity of accessing the largest data center for their application software needs.

Top benefits of cloud computing
Cloud computing offers different benefits ranging from increased savings in cost to highly improved marketing speed and even flexibility. However, this is only a piece of the cake as there are even other benefits of cloud computing that cannot be noticed easily. To start with, investing in cloud computing requires little to no capital outlay which honestly speaking, it’s the most basic and important benefit of computing via the cloud. The very free nature of the cloud reduces the high services of technological maintenance and integration. This provides small businesses with a golden opportunity of running an integrated package of computing products without draining all the business resources into web hosting.

In fact, there are some providers of cloud computing who provide free software as a service to small businesses with inadequate resources to invest in good IT infrastructure. For such businesses, they only have to pay the low monthly cloud computing subscription cost which is an additional benefit to them. In cloud computing, acquisition and deployment is done rapidly given that users do not have to install the systems manually as the cloud provides the software connection. With the software being accessed through the clouds easily, the number of deployment times is simply trimmed down to only a fraction of what they used to be. Cloud computing is infinitely scalable. This implies that this type of computing offers no physical limitations and you can always expand freely over the clouds depending on your needs. Businesses that have adopted cloud computing incur very low ongoing operating costs as no investment or maintenance costs are needed. With cloud computing you only need to relax and enjoy all the services without worrying about any associated additional costs.