You establish your own company and investigate the following elements in your company.1. Establish a business model. What you want to sell. Who is your target market? How you want to market? How you want to generate revenue and so on. 2. You establish mission, vision, goal and value for your company. 3. You will establish an organizational chart for it.. 4. You generate resources and capabilities. Then Skills and competencies. 5. You apply your competencies to your functions, R&D, Marketing….. 6. You define strategy and how it corresponds to your mission….. 7. You apply SWOT to your company 8. You apply Porter’s model to your company 9. you define how your company becomes efficient and innovative 10. You define how you create value for your customerHarrisburg University
MGMT 510-50 Project 1
Akshay Gavai
Guilin Zhang
Products
Target Market
Marketing Strategy
Mid Segment Consumer
Market
Price our products to be
affordable and provide great
value
Revenue
Resources
Through the sale of vehicles;
Eventually batteries
People
R&D Facility
Located in North Carolina, United States
Taking advantage of low manufacturing costs
Not many auto assemblers in the area
Co-located to nearby suppliers
Looking to get an IPO to fund our business
Our discovery of high capacity lightweight
batteries
Automobile Industry
Fragmented Industry
Many players
Brand recognition
Plagued with safety recalls
Electric Vehicle Market
Limited players from industry
Few models released
Nissan
General Motors
Chevy Bolt (2017)
Tesla
Leaf
Model S
Mitsubishi
i-Miev
Mission
Akshay & Guilin Co.’s mission is to build affordable
long range electric vehicles that meet or exceed 5
star safety ratings for the national and international
consumer markets.
Vision
1) A global automobile organization that is
recognized for its safety and quality
2) Leader in innovation and new technology for the
electric vehicle and battery market
Goal
Launch a mid-segment electric vehicle that
meets/exceeds 5 star safety ratings by Fall of
2017 for the consumer market in the United
States
Values
Ethics is inherent to our organization
We want to wow our customers with our emphasis on quality
Building strong relationships with people – customers,
suppliers, and employees
Provide a nurturing atmosphere for our employees
Corporate
Vehicles
V.P of Finance
Accounting
V.P. of Human
Resources
Human
Relations
Training
Batteries
V.P. of Operations
Manufacturing
V.P. of Research
and Development
New Technologies
Existing
Technologies
V.P. of Sales and
Marketing
Marketing
Sales
Strong financial base
Ability to make large investment in capital
required for manufacturing and R&D
Human Resources
Management has experience working with electric
vehicle market and has connections to many
people within this industry
Ability to hire skilled engineers required for
developing the product
Skilled labor
Engineers – mechanical engineers, electrical
engineers with experience in the automotive
industry and battery technology
Management – Expertise with creating efficincies
and quality control within manufacturing
Battery Technology
Ability to create superior batteries for the electric
vehicle market due to our R&D facility
Operations & Marketing
Our team has a strong background in
management and in the automobile industry hence, we have the ability to create an efficient
manufacturing system
R&D
Given our heavy investment in R&D, we are
developing a state-of-the-art R&D facility which
has created superior batteries for the electric
vehicle market
Position our products in a untapped market
Long range electric vehicle – 200+ mile range
Affordable – $20,000 to $25,000
Safe – 5 star safety rated
Address Global Markets
India, China
High Pollution; Strong need for Low and Zero Emitting
Vehicles
Position our products in a untapped market
Long range electric vehicle – 200+ mile range
Affordable – $20,000 to $25,000
Safe – 5 star safety rated
Address Global Markets
India, China
High Pollution; Strong need for Low and Zero Emitting
Vehicles
Analyze our strengths,
weaknesses,
opportunities and
threats to discover
new opportunities,
manage and eliminate
threats.
Picture from [2]
Strength
We have patents for new technology and
production processes;
Skilled labor in engineering and research
and development
Weakness
We are new player in this industry;
Still need to mature as a business;
Opportunity
The electric car market for the mid-range
consumer segment is wide open; Battery
technology has not yet been explored as
needed by other manufacturers
Threat
Our competitors may produce similar
vehicles; Gas prices may remain low; Tax
credits could get eliminated
Threat of New Entrants – Low
•
•
•
Difficult to enter automobile industry
Heavy capital investment
Fragmented industry overall
Threat of Substitutes – Low
•
•
Public transportation is still not great nationally
Peer to Peer transportation is not a direct substitute for a personal
vehicle
Bargaining Power of Customers – Medium
Not many models in this segment
High switching costs
Brand loyalty
Bargaining Power of Suppliers – Low / Medium
No single component which is critical
Cannot make all components on our own
Many suppliers in this industry
Industry Rivalry – High
Many auto manufacturers
High fixed costs
Maintain a strong investment in R&D
To continually innovate new technologies and
products
Incorporate efficient processes
Use ‘lean’ manufacturing techniques
Eliminate unnecessary waste in our manufacturing
Use six sigma for quality control
Eliminate the need to rework any production processes
62 miles; 4 Star Safety
$25,000
100 miles; 4 Star Safety
$35,000+
250 miles; 5 Star
Safety
$70,000+
$30,000
Value
$22,000
Price
Cost
$15,000
1)
2)
JeffTollefson, Car industry: Charging up the future, Nature, 2008, 456, 436-440.
https://www.mindtools.com/pages/article/newTMC_05.htm
SMART BIRDS
MGMT 510-51- N-2018/SPRING
BUSINESS STRATEGY & MANAGEMENT
PRINCIPLES
Agenda
▪
▪
▪
▪
▪
▪
▪
▪
Business Model
▪ Product
▪ Target Market
▪ Industry growth
▪ Market statistics
▪ Market strategy
▪ Revenue generation
Mission, Vision, Goal and Value
Organizational Chart
Product Features
Strategy
SWOT Analysis
Porters’ 5 Forces
Value Add for customers
Business Model
▪
Product
▪
▪
▪
▪
Drones for Non military applications with secure data collection
capabilities and customization options for the traket markets.
Classes for Drone usage
Repair facilities for drones.
Target Market
▪
▪
▪
▪
▪
Professional Aerial Photography
Delivery mechanism for small businesses
Big data gathering. Walmart, is testing how drones could help improve
warehouse inventory management[2].
Fast food delivery : Domino’s Pizza will be looking to invest in drones for
pizza delivery in the future[2].
Media Reporting
Business Model
▪
Industry Growth:
▪
The drone business opportunity market is posed to grow 190% from 2014 to
2024[1].
Business Model
▪
Market Statistics:
▪
▪
DGI (Dà-Jiāng Innovations
Science and Technology Co.,
Ltd) is prime market holder
right now. Owns 70% of the
market over 500$ drones
and 1000$ drones[3].
Lots of small competitors in
the under 500$ range, DGI
doesn’t own most of the
market here.
Business Model
▪
Competitors in 2018
Business Model
▪
Marketing Strategy:
▪
▪
▪
▪
Marketing via Ads on Youtube (as youtubers are currently one
of the biggest consumers of drone technology for video
recording purposes)
Conducting market survey before deciding on choosing location
to launch the initial business in.
Advertise on social media like Twitter, Facebook, Linkedin.
Revenue Generation:
▪
▪
▪
Competitive pricing in 1000$ to 1500$ range.
Ease of payment options to attract more customers
Lower profit margins in the beginning to build customer base
Business Model
▪
Competitive advantage by
▪ Increasing efficiency in value chain
▪ Value creation and customer retention by providing high quality
product.
▪ Value creation and customer retention by providing great
customer service.
▪
Invest highly in R&D
▪
Own our production chain to maintain our differentiation
▪
Running Internal and external analysis
Mission, Vision, Goal And Value
▪ Mission: Provide businesses safe and faster delivery solutions and safe data
collection using high tech drones devices
▪ Vision: Become the primary delivery solution for all businesses.
▪ Goal: Become main company in the production and sales of advance drones
technology.
▪ Value: Our customers should be able to feel confident in the safety of our
product (data collection, delivery)
Resources and Capabilities
▪
Tangible ResourcesProduction plant located in Detroit (due to lower rents and existing
infrastructure we can leverage)- will scale up in response to increases in
sales and demands
Supply and distribution chains – will allow us more control over our
distribution channels and product
▪
Intangible ResourcesStrong R&D Team- that will allow us to innovate and differentiate our
products from competitors
Marketing Research Team- to get feedback from consumers and markets
and allow us to both tailor our products in response, and target wider and
different sections of the market
Product Development
• Studio team – Product concept
• Design and architecture – packaging and attachment strategy
• Virtual testing – Noise, Durability, Crash, Aero, Thermal
• Physical testing
• Supplier develops – Cameras, sensors, propeller, motors, battery
• Software / IT team develops coding
Organizational Chart
CEO
CFO
Administration
HR
R&D
VP Marketing
VP Sales
CTO
Mkt Product
VP US Sales
VP
International
Sales
Brand
Development
Sales
Managers
Sales
Managers
Customer
Success
IT Director
Security
Manager
Logistic
Director
Strategy
▪ Deliberate strategy. New industry/product (uncertainties)=> Emergent strategy
▪ The drone industry is transitioning from an embroyonic to growth stage
▪ The barriers initially faced due to consumers unfamiliarity with drones are rapidly
being overcome as more industries (photography, retail and delivery, etc.) adopt this
technology
▪ Broad approach: Capturing the early majority. Our company’s strategy will focus on
aggressively promoting our products and utilizing the ‘viral model of infection’
▪ We plan to encourage early adopters to evangelize for us, in order to gain a
stronghold with the early majority.The increase in visibility and exposure to drones
will help us to overcome barriers of other consumer’s potential reluctance to adopt
this technology
Strategy
▪ Differentiation strategy
▪ The industry is highly fragmented due to lack of scale economies and low barriers to
entry
▪ We plan to leverage this to our advantage by ensuring we cater to all the different
industries that may potentially use drones- retail delivery, media outlets, amateur
and professional photographers; and tailor- make our products to each
▪ Our R&D and Strategy teams will also focus on identifying and innovating new
applications of our products – future technology will help us sustaining our
differentiation
▪ This will allow us to both gain a strong foothold in the drone distribution industry,
and discourage potential new entrants
Functions
▪ Competitive advantage:
▪ Superior efficiency: Best resources, hiring staff with experience, best use of our
capital (capital productivity)
▪ Superior quality: Reliability of our technology (safety)
▪ Superior innovation: R&D ++. Development of a product, high safety, data
security.
▪ Superior responsiveness: Hire a customer success manager, listen and develop a
product that match our customers’ needs, dialogue
Product Features
• Compact foldable design
• Weight = 800 g
• Internal storage = 16 GB, Expandable up to
= 128 GB
• Ultra-quiet propellers
• Top speed = 40 mph
• Flight time = 40 min @ 30 mph
• Ascend speed = 7 m/s = 15.7 mph
• 16 MP camera with 4k recording
• Descend speed =5 m/s= 11.2 mph
• 360 degree obstacle sensing
• Control via mobile device, remote controller
• Removable battery = 3500 mAh
• Quick charge 3.0
and Goggles.
• Available in black, red, white and blue color.
SWOT Analysis
STRENGTHS
– PATENTS
– STRONG R&D
– SUPERIOR
PRODUCT
QUALITY
WEAKNESSES
– EXISTING
PHOTOGRAPHY
COMPANIES
HAVE THEIR OWN
EQUIPMENT
– LIMITED
FLEXIBILITY IN
PRICING
– COMPETITORS
CAN OFFER
SIMILAR
PRODUCTS
QUICKLY
– LOW BARRIER TO
ENTRY
OPPORTUNITIES
THREATS
– LAWSUITS
– DRONES AS
SERVICE
– ENTER
UNTAPPED
MARKETS
– SCOPE FOR
VERTICAL
INTEGRATION
– – FIRST MOVER
ADVANTAGE
– DEFACEMENT
– UNKNOWN
REGULATIONS
– HIGH SOCIAL
MEDIA
MARKETING
COSTS
– CONSTANT
TECHNOLOGY
UPGRADE
REQUIRES HIGH
INVESTMENTS
– HIGH
PRODUCTION
COSTS
Porter’s Model
Bargaining Power of
Suppliers: High
– Limited Suppliers
– Switching Cost of Suppliers
Bargaining Power of Customers:
Medium
– Competitors’ Products Cost
Higher
– Willingness to Pay Price for Value
and Superior Technology
COMPETITIVE RIVALRY:MODERATE
Differentiated Services and Pricing
Models
Threat of New Entry: Low
– Requires Strong R&D
– Requires Licenses and Approvals
– Untapped Markets
– Capital Intensive Industry
Threat of Substitutes:
Medium
– New and Better Technology
– Untapped Markets
– Brand Loyalty
Efficiency And Innovation
Value For Customers
• Customer satisfaction depends on the product’s perceived performance relative to a
•
•
buyer’s expectations. If the product’s performance falls short of expectations, the
customer is dissatisfied.
Customer service will also function as a strong value-add. Our company will provide 24/7
helplines to guide customers on how to use their purchases, as well as any other
customer support required.
This important figure shows marketing in a nutshell. By creating value for customers,
marketers capture value from customers in return.
TEAM
•
Haris Affaq
•
Zeeshan A. Bashir
•
Franck Legrand
•
Rohit Nagarkar
•
Palak Porwal
•
Ankeeta Shukla
References
1. https://thedroneco.com/drone-franchise-vs-drone-biz/
2. http://www.businessinsider.com/how-to-start-a-drone-business2017-8
3. http://www.dronesglobe.com/news/drone-market-share-analysispredictions-2018/
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