Chapter 6: Organizational Strategy, Review Section 6-2-Strategy Making Process T
ID: 385934 • Letter: C
Question
Chapter 6: Organizational Strategy, Review Section 6-2-Strategy Making Process The Beach Based on Exhibit 6.1: Three Step of the Strategy Making Process Step 1: Assess Need for Strategic Change, 6-2a Your group represents the management team of a locally owned and operated water park, The Beach, which has been in business for 15 years: Revenues are $5 million per season equipment is neither new nor old the company has little debt they have a good reputation in the community they get a flood of job applicants each summer Next season, the Paramount's King's Island amusement park across the highway is adding a water park to its traditional thrill ride attractions. Step 2: Conduct a Situational Analysis (SWOT), 6-2b SWOT Analysis Template STRENGTHS WEAKNESSES OPPORTUNITIES THREATSExplanation / Answer
SWOT Analysis of The Beach
Strength
• High revenue from the part per season
• High brand value
• Provides job opportunities for lot of local individuals
Weakness
• No new rides due to debt
Opportunities
• Improving the infrastructure and equipment’s
• Improve the working efficiency and ensure best talent can be acquired
Threats
• Debt can increase and can cause leakage of profits
• New rides coming up in the nearby theme park, Paramount`s King`s Island
To use the best of opportunities and to reduce the risk, I would advice in a risk daring strategy. While it is known that Beach is having a certain amount of debt, the debt is not too high that it can go bankrupt. This shows there is still certain limit before it reaches the tolerance level and company should start looking at cost cutting. The high amount of job applications it receives every year shows that the park is a well-known brand and people want to be associated working with them. They also recognize Beach as a better employer as compared to King`s Island. The company can take this in view and brainstorm new ideas and themes for the amusement park. While putting a significant investment is always a risk, not putting the investment and letting others go ahead is a bigger risk which can lead to closure itself of the Beach. Expanding the park and adding new rides would also ensure the local visitors who have visited Beach in the past get another opportunity to visit them again to ride the new rides. If the theme and plans are properly executed, it can lead to higher interest from local visitors and interest will rise from word of mouth. The teams would have to ensure that they provide a differentiated service and experience to the visitors at the resort. While cost and investments are risk, the potential returns and the brand value which Beach retains are higher than the investment and is worth the risk. So I would advise the management to take a risky strategy and work on expanding the park and improving the rides.