Question one Relying on the Staircases to growth paper, analyze each of the…

Question one

Relying on the Staircases to growth paper, analyze each of the seven staircases. Which of the seven staircases is your organization using to grow? Which ones would you recommend, why? Does your organization have enough market power so that such growth strategies may help to create value?

Question two

Which of the resources (platforms of capabilities) mentioned in this paper is your organization implementing? Explain one by one, how they are used, could be expanded and could be implemented in your organization. Are they unique resources, why or why not?

Question three

Does your organization implement the three horizons approach that McKinsey proposes? If so, how are they implemented? If not, make your own proposal for each horizon.

Student response 1

1. The seven staircases of growth are; maximizing existing customers; acquiring new customers; innovation of products and services: innovation of the value-delivery system:  improving industry structure; geographical expansion and steeping into new business arenas.  Growth potential should be linked to core values and strategy.
Maximizing existing customers: This gives the organization a chance to review their current marketing strategy.  This step can help executives maximize opportunities by boosting the current customer size and frequency of purchases.  This could be accomplished through loyalty points that offer monetary prizes, free shipping or free items.
Acquiring new customers: Expounding upon current marketing strategy to produce authenticity and address trends help boost market size, customer base size and maximize growth opportunities.  Taking a closer look at market segmentation can help develop or re-develop marketing strategies.  Many companies such as McDonald’s and Disney have utilized this approach.
Innovation of products and services: This step helps to determine new products and enhance current ones.  To maximize growth opportunities organizations can perform a PEST Analysis to point out trends in consumer perceptions.  Fast food companies are in a constant state of competition.  Health & Wellness concerns change frequently as well as consumer needs.  Technology companies are another example.  The every changing use of electronics and ways to connect and communicate drives the need to be #1 in the market and forces innovation.
Innovation of the value-delivery system: This step helps organizations improve the way they deliver their product or service to increase growth.  Creating a Value Chain Analysis will help organizations improve product and service quality, work more efficiently and even uncover more sales channels.  Incorporation of alliances and partnerships can help the organization meet demand and quality measures.
Improve industry structure: This step helps organizations find out the best use of mergers, acquisitions or joint ventures to expand their business and products.  This step allows for alliances with companies both with the industry and outside.  This step can be risky because of the possibility that new strategies may not enable the organization achieve value.  However, this step could bring a greater bargaining power to the company and competitive advantage.
Geographical Expansion: This step helps to distinguish the organizations actual reach and map out the best opportunities and review markets the company is already serving.  This could be risky but could end up producing long-term potential and create economies of scale.  This step can be best utilized with Porter’s framework on how to adapt and monitor culture sensitivities.
New Business: This step helps companies establish better ways to diversify their brand, by either using vertical or horizontal integration.  Some examples include Stepping outside of the box could prove beneficial to some companies and help expand their products or services and reduce competition.
It seems that my organization is following the innovation of products and services growth step.  MES is in the beginning stages of building a customer portal.  This is intended to help vendors and potential vendors find information faster, update information and even have real-time contact with GIS and other field personnel.  Although I have researched other organizations within proximity of MES, I would recommend adding geographical expansion to other states.  With environmental services growing and more consumers becoming environmentally aware and wanting to do their part, expansion would benefit the organization.  There is a large amount required for startup for some facilities but can be made up with products produced.  Being a semi-small organization does limit market power, but with proper implementation of marketing strategies and organizational strategies, growth could be seen.
2. Although growth is predicted to rise, changing governmental oversight and dismantling can possibly limit growth.  MES is distinct in their services and products. MES operates on mostly state and federal funds.  To increase their growth potential it is suggested that management review their current business strategy and incorporate more financing opportunities to both minimize risks and increase potential.  Build partnerships with more private organizations that have a solid track record and long-term sustainability.  Partnering with other private organizations can open up special relationships to increase sourcing abilities and develop their value chain.  An increase in competitive advantage could be an end product due to increased capabilities to satisfy customer needs.
3. The three horizons are to promote agility and innovation and can be complete simultaneously for some organizations.   I do not believe that MES is using the three horizons effectively.  Horizon 1 – I would recommend an extension of current operations that begin at the corporate level.  Streamlining lengthy processes focus more on risk management/score cards, and diminishing the need for certain positions will lessen bottlenecks, produce more effective communication and produce outcomes.  Therefore enabling the organization to effectively plan and forecast changes to the industry and customers.  Horizon 2 – Management should be able to balance long term and short term goals to maintain organizational momentum. To include the building of better resources as discussed in question 2.  This would propel MES into Horizon 3. A mode to increase value drivers and future business goals to fully adapt to changing industry standards and competencies.  It would be recommended to partner with private companies to build upon current business strategies and utilize more innovative/emerging industry tools and machinery.

 

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