Relationship Management Essay
Many corporations use strategies to remain competitive and dominate its competitors. Strategy must be carefully analyzed as it will impact a firm’s growth or failure. Many companies have succeeded and many become solvent. In this section provides a brief overview of major companies that use various strategic tactics to maximize its shareholders profits. Additionally, these strategies can be applied to small companies such as Sierra Bravo and others.
Digital River Inc. is a global leader in e-commerce providing support for its client’s transactions. The Digital River focused on a specific area and developed its own program to support its clients’ stores. Digital River do not run a store, they run the clients store. Digital River uses Oracle and Sun that was developed internally to support a large framework of clients. Chief Executive Officer Joel Ronning, says they can manage its cost better than its competitors.
However, he mentions that technology is not that grow the business (Claburn, 2001). The main purpose is how could one gain customer loyalty? By managing its clients’ e-commerce sites, deal with issue such as return and purchases and deliver results keeps the company running. The strategy Digital River use to gain customer loyalty is managing its client’s
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General Electric (GE) created growth through its Ecomagination program. The Ecomagination is a program that GE is concern for the environment by developing products from energy efficient compact fluorescent light bulbs to hybrids locomotives. GE capitalized on turning risks into opportunity while many other competitors were litigating and lobbying to avoid litigation (Bekefi and Epstien, 2008). In a 2006 report for GE’s Ecomagination program revenue already exceeded $12 billion annually. Many other companies are moving towards the Ecomagination method.
Google is the leader in search engine and to remain competitive from other big companies such as Yahoo and Microsoft; Google is partnering with some other successful companies. “It has teamed with Intuit to enable small-business owners to manage Google ad campaigns, partnered with eBay to offer “click-to-call” ads that connect online shoppers to sellers, joined with MySpace to supply the social network’s search and advertising, and helped MTV distribute video clips with ads tacked on” (Caplan, 2006). Google is trying to create a partnership with Dell to have Google toolbar as part of the computers designed. Small partnerships and strategic alliances help the company remain competitive to fend off the major competitors. Google is still the global leader in search engine.
Apple is one of the leaders in innovation by developing new apple computers and I pods and I phones. The company has capitalizes on new innovation and change the way people listen to music and communicate. Back into 2005 when I pod music player was introduced, Apple reported in the second quarter of 2005, received $320 million in profit. Brand is important in Apple’s business strategy. The company retains its customers through other services from branding and new products. Combining the current services with new products maintain customer loyalty through branding. Overall, Apple is very successful and continues to push the envelope to higher and innovation product offerings.
Amazon is a global brand for online books. The e-commerce giant is recognized for book sales and allowing customers to sell. The company added new product lines such as toys, electronics, clothes, and software to its business line. The company has developed over 30 million customers globally. The company business strategy is Customer Relationship Management and IT support tool. “The company carefully records data on customer buyer behaviors. This enabled them to offer individuals specific items, or bundles of items, based upon preferences demonstrated through purchases or items visited” (marketingteacher, 2008). In 2004 the company reported sales increase 26% that jumped from 76 million to 1.75 billion dollars.
The five companies used different strategies to remain competitive in the business world and are successful. The five strategies presented included creative ways to resolve customer’s issues and gaining loyalty. Taking risks and turn it into opportunity is another strategy that GE capitalize on; Google’s strategic partnership with other companies to offer and market its product. Innovation and brand continues to bring and keep customers using the same service by wanting more, then finally tracking customers behaviors and applying results to business strategy.
For a small and young company such as Sierra Bravo, some of these strategies can be applied and may need to wait until the company grows bigger. For example, in the current situation for Sierra Bravo the strategies can apply is finding solutions that deliver results for its customers. The company needs to help its customers increase profits. By helping customers increase profits the loyalty will be there for future business opportunities. Another strategy Sierra Bravo can apply is strategic alliance/partnership. The company is currently using this technique with marketing and advertising agencies. Market development is one of the major strategies that will help the company meet long-term goals. Thus far is working well for the company and will continue to use this strategy as it expand.
The other strategy Sierra Bravo can benefit from is through innovation of its product. How can Sierra Bravo create a strong brand and innovates new systems to change the business world such as Apple did with the I pod? Sierra Bravo should implement an Innovation Department to help compete against competitors. As for the other strategies such as Eco friendly services and tracking customers behaviors could be applied for future plan. The company is still young and by implementing high risks could impact the business operation. Tracking customer behaviors would not be necessary however; the company can help track its client’s customers to find best solutions to increase profits.
Implementing these five strategies will be a challenge. An important issue to remember about implementation is focusing on a couple strategies during the growing phase. Taking high risks could jeopardize the growth momentum for Sierra Bravo. The five strategies illustrated by fortune 500 companies proved to generate revenue for major corporations. Applying these strategies to Sierra Bravo’s strategic plan will impact significant growth, profits, and meet long-term objectives by expanding into different locations.
Plan Goals and Implementation In order for Sierra Bravo to meet long-term objectives a plan goal and implementation process must be establish. The initial phase to meet long-term objectives is to develop short-term objectives. “Short-term objectives help do this. They provide much more specific guidance for what is to be done, a clear delineation of impending actions needed, which helps translate vision into action” (Pearce and Robinson, p 288). Below are short-term goals that will support the long-term objectives mentioned earlier.
Short-term Goals 1. Market development – by collaborating with marketing agencies. Account managers will use various database to target a certain city. The goal is to add 15 agencies a month. 2. Sales will need to be increase and the number of programmers should be as well. The goal is to add at least 10 programmers after the next sixths months. With the number of new accounts and customers it will help reach the long-term goal.
3. In order to expand into different locations the customers and partners will be tracked based on the city during marketing. Every two years the company will evaluate the business locations that show high profitable areas. The one year time frame will help the company plan for adding new locations. 4. In order to retain talented programmers the company supports continuing education and cross functional training. The company will develop a mentoring program for protï¿½gï¿½ and nurture them into future leaders.
Employee empowerment is part of the company value and culture. Employees are encouraged to suggest ideas and present to management. All ideas will be taken in serious consideration if meet long-term goals. Understand employees motivation will be important and will be achieve through company wide surveys. Action plans and implementation are important element in the goal setting process. The action plan below describes the plans required to meet short-term objectives.