Consider the following scenario: You have held conversations with Precision Part
ID: 2448643 • Letter: C
Question
Consider the following scenario:You have held conversations with Precision Part's leaders and obtained the following information, which you want to use in the development of a 4-year strategic management plan.
-PPQ Parts employees mow number 5,000 and all are currently employed in teh United States. It plans to grow to 10,000 employees in 4 years.
-New facilities will be needed in International expansion, and PPQ Parts anticipates building most of those (80%) outside the United States. P-PQ Parts holds 5% of the world market share on small SUVs, but its goal is 9% in 4 years.
-Current stock price is $10 per share. The goal is $22 a share. Profit margin 3-year average is 6%. Industry average during this time has also been 6%. The company goal is 13% in 4 years.
- PPQ Parts has averaged 28% employee turnover during the last 3 years. This is compared to an industry aaverage of 25%. The company's goal is to increase employee retention by lowering annual turnover to 17%.
- PPQ Parts contributes to all the local communities in which it is doing business. This is one of its corporate values. Current charity is 0.5% of total profits,but the company would like to raise that to 5% in 4 years.
Assignment
A strategic management plan is vital for the company business today. Review the company scenario for additional information regarding growth goals. Create a basic strategic management plan for PPQ Parts including quantifiable goals and measures. Include the following in your report:
-Provide environmental scanning of current conditions in the area of expansion including economy, competition, political stability, and so forth.
-Address interrnal resource analysis such as managerial and financial strengths and weaknesses.
-Please include short-term and long-term strategic goals
-Location consideration for implementation is vital. Please explain the benefits and limitations for expasion in your chosen area.
Explanation / Answer
Plans to introduc e an expansion into a country must address a mass amount of issues by the host country. The factors affecting a nation's rate of utilization and absorption of technologies include both external and internal ones. Internal factors are comprised of the obtainable human and physical resources, the country's infrastructure, and its growth rate and state of development the host country must provide. External factors embrace the readiness of merchants to conduct commerce in the country, and the accessibility and amount of global aid aimed at the transfer of such technologies . The condition of a substantial communications infrastructure is vital. Sufficient intercontinental and domestic links may not be reliable or present; equipment and machinery may be difficult to get hold of, sustain, and renovate; electrical power also might not be dependable. Computers and interrelated peripherals necessary may be inadequate, or even absent. Communications and transportation links may be very weak and delay progress. Upgrades in the host foreign country may be needed, prior to an expansion of an MNE. PPQ Parts: Issues relating to global expansion Consider the following scenario: PPQ Parts has determined that for the company to expand globally over the next several years, its managers must be properly trained in multiculturalism and diversity management. PPQ Parts executives must be aware of any political and economic concerns that may arise during the expansion. Using the library, course materials, and other Web resources address the following: 1. What are some of the issues the host foreign country could face as a result of the expansion? 2. Explain what cultural barriers and diversity issues are commonly encountered by international/multinational (MNC) and global organizations. 3. Why has diversity become such an important topic in the international arena? 4. What can occur when issues related to multiculturalism and diversity are ignored in an international company? 5. Describe at least 2 political and 2 economic issues that may arise during global expansion and proposed methods of addressing them. 6. Explain the importance of and the implications of each of these items in PPQ Parts's expansion plans to Germany and Japan