Operational for Salvo Motor Corp Organisational Chart - Business Plan Example

Operational Plan [Pick the Introduction: The fast going business sector of the world has enabled young entrepreneurs to flourish and put their management skills to use. There is no use putting an excellent idea on the market unless it can generate money and money can only be wisely generated if the company has a well-planned structure and the right mix of management to keep that structure up. The purpose of writing this paper is to put forward a fictional organization that is well structured, well managed and to present its operational plan. OPERATIONAL PLAN FOR SALVO MOTOR CORP ORGANISATIONAL CHART President: The president is responsible for setting the vision and strategy of the business. The role of the president is to set budgets, hire team, form partnerships and steer the company according to plans. VP Marketing: The VP Marketing decides on how the products are to be set in the market. The promotions and advertisements fall into this category. VP Sales: The VP sales sets strategies for setting prices, selling the product, hiring the team, setting sales tactics, boosting the teams to better sell products. VP Production: The VP of production is responsible for setting plans, directing and coordinating the development and manufacture of all products made. The VP also ensures that the company uses the most efficient, effective and economically viable methods for the production of the companys products. BUSINESS VISION AND MISSION SALVO MOTOR CORP. is a new car manufacturer located in Spain. In this document we present what the Strategy will be for the first three years as well as how it will be implemented, and the expected results we will achieve as a company. SALVO MOTOR CORP.’S PHILOSOPHY Mission Salvo aims to achieve a reputation in the market, not only by satisfying our customers’ expectations, but exceeding them, by introducing quality, efficiency and design to our cars. Vision Making people proud of owning a SALVO, as well as not only creating value to our clients, but also for our stakeholders by growing constantly and reaching our objectives. Our vision is to differentiate our product on the basis of quality and overall experience we provide to our customers in order to set a proposition value in our customer’s minds and to make loyal customers. Values We care about our client, that’s why, selling doesn’t mean ending the relationship with them, but starting it. Treating our employees like people, not just as resources to getting things done, and growing in harmony with the environment. BASIC PLANNING PROCESS SALVO MOTOR CORP. will be first, focusing our efforts in building a strong brand value by launching a car which could be included in the Upper-Medium segment, called SALVO PRIVILLEGE and will sell it in the German, French and Italian market. We will be expanding, not only by launching new specifications and engines in the same market, but also to new markets such as the Lower-Medium which we want to target in year 3. In order to satisfy our customers and also the general public, we will be paying special attention to quality, safety, comfort, design and price. PRODUCT SPECIFICATION For the first year, we will introduce SALVO in the Upper-Medium segment. After considering what the name for our first model in the market should be, we came up with a name which in our opinion inspires quality and distinction, both two of the adjectives we have in mind and want SALVO to reflect. The chosen name is SALVO PRIVILEGE. We wanted to produce a car of a high quality and a great, as well as safe and also comfort, but with competitive prices, that would make our car desired for most clients as the primary research information analysis we did, gave great results and those features where the highest ranked among car customers in our segment. For this purpose, we decided our car to be equipped with the following features: ABS Power steering Electric windows and mirrors Central Locking Air Conditioning Fog lamps Heated Widescreen In-car entertainment As a result of all the components, features and resources used by SALVO, we can fairly say that the SALVO PRIVILEGE is a splendid car which will exceed expectations of our customers. After doing a R&D project for Diesel cars, which will start in January Year1, as we saw there are great advantages in selling cars with Diesel engines, especially in our sector, where more than 50% of the cars they sell uses this kind of fuel, we will be launching a variety of the Salvo Privilege, which will be called SALVO ECO-PRIVILEGE. The main features of this model will be the ones that follow: Diesel Engines Side Airbags Car Park Control Cruise Control Apart from those features, the car, as it uses diesel, will have lower fuel consumption, and at the same time, will have lower CO2 emissions, which will make us gain a portion of the market share, within those customers who worry for the environment. In the third year, we will be expanding to the Lower-Medium Market, with the SALVO WAVE. We just have the first designs and we are doing some tests on customer’s opinions. MARKETING PLAN SALVO’S MARKETING PLAN-YEAR 1 Salvo is a new innovative and environmentally-friendly automotive manufacturer. We aspire to build high quality upper/medium cars that are both durable and are value for money. Marketing Aims We at Salvo have four main aims which will aid us in achieving our mission and ultimately allow us to be global quality automotive manufacture: Target audience Below is a list of the three main characteristics that Salvo’s target audience must have: OPERATIONS PLAN The Salvo Privilege will be the first car manufactured by Salvo. LOCATION The production of the Salvo Privilege One (P1) will take place in a company owned factory located in Spain. There are several characteristics that make this the optimal location. Location Cost of factory France £450 million Germany £650 million Italy £350 million Spain £400 million UK £625 million FACTORY PRODUCTION LINE In Salvo’s first year we will capacitate 3 assembly lines with 2300 workers per line and 10 robots per line. Salvo’s brand denotes quality this was reinforced in our test-marketing phase where quality levels were approximately 100%. Salvo intends to maintain this high level of quality production in order to gain a strong brand loyalty.  Manual workers- 2300 per line (00’s)  Robots 10 per line                  This will be replicated over every line at Salvo. The reason for having such a large amount of robots (10) is to ensure high quality is maintained, there is a strong positive correlation between quality and number of robots. After 6 months Salvo will launch the Salvo EcoPrivilege, similar to the Salvo Privilege 1 but with a diesel engine and other improved specifications. This will change the format of the factory to 3 lines producing Privilege 1 and 2 lines of the EcoPrivilege. DEMAND-PRODUCTION FORECAST Year 1 Year 2 Year 3 PURCHASING STRATEGY The purchasing strategy is in place based upon the demand forecast. Salvo aims to purchase a fixed amount of steel per week at a fixed price through contract. Salvo is contracting 40000 tonnes every ten weeks at a fixed price of £500. This will enable us to have adequate amount of steel to meet our production targets. The production target for the Privilege 1 is 350 units per week per line (1050 in total). The fixed price of 500 will be a continuously fluctuating price in the market but Salvo aim to take advantage by buying in bulk making use of economies of scale. We will be buying wind turbines to further promote Salvo as an eco-friendly brand, they will cost £10million. MANUFACTURING STRATEGY After eight weeks we will increase the amount of production lines from 3 to 5. This is due to sales forecast and maximizes full capacity. These new lines will maintain the same format as the initial 3 assembly lines; 10 robots and 2300 workers per line. The production targets for the Privilege 1 will increase from 1050 to 1750 with the increase of production lines. After 6 months we will produce the Eco Privilege, which will be manufactured on 3 lines whilst the original unleaded Privilege will be produced on 2 lines. This will cater to our green conscious consumers and improve our brand image as a more environmentally friendly company. In year 2 we will be purchasing a new factory, in Spain. The lines in factory 2 will be identical, 2000 (300 covering for absenteeism) and 10 robots. However in factory 2 there will only be 3 lines. In year 3 we will increase the amount of lines to 10 over both factories. Factory 1 will have 5 lines producing the Privilege on 3 lines and Privilege Echo on 2 lines. In factory 2 Salvo will be manufacturing EcoPrivilege over 2 lines and the newest model, the “Wave” on 3 lines. RESEARCH AND DEVELOPMENT In SALVO we are proud about our quality and high technology resources, so we take very into account the R&D process. For this reason, we will be making a huge financial effort in order to keep being leaders in this sector among the next 3 years. Year1: Total £65,000,000 Year 2: Total £78,000,000 (20% raise over first year’s R&D Budget) Year 3: Total £96,000,000 (23% raise) *In brackets the costs and durations of the projects imputed each year. We think all these projects, will ensure SALVO’s image and will give us the chance to maintain a stable growth over the next few years, that traduces in increasing sales, market share, brand value and report larger incomes. As you can see, we will be able to launch our 2nd model in Year 3, March. After the R&D project new model development which takes 26 months. MANAGEMENT INFLUENCE ON PLANNING Top management influences most of the strategic planning, however the middle and low level management is responsible for actually achieving the planning goals defined above because these managers manage workers who design these cars and gain one to one experience with the client on field during selling them. The feedback of sales executives is really important as it further leas to production executives in designing cars that meet the user’s needs The three main factors that affect our planning process are Quality, Productivity and Profitability. As the plan states that we aim on building strong brand value, quality should be kept at the highest priority. Brand value is greatly distinguished by how satisfied your customers are and good quality enables customer satisfaction. Improvements in productivity can have a dramatic effect on growth and can often be achieved without substantial capital investment. The planning greatly depends on how productive the business is. By having a high morale of employees and good will, the overall productivity can be raised which can help us achieve our goals in lesser time with more efficient use of capital. Profitability can help achieving goals by giving the workers an incentive to work more and smarter. The company can benefit from profits and can aim at higher profits which in turn can help the business grow. Since our plan is to expand globally, a high profit margin can definitely help us achieve this goal without investing in too much money since the return on capital would be high. There is a need to understand that the strategic plan and the HR plan should be devised simultaneously as they have a very close relationship. For a company to succeed, HR managers should be valued as they provide the driving force for any organization. For any strategy to develop there is a need to involve the employees in the process. This should be done before the final implementation of any new strategy. Doing this is a key factor for organizational success. Additionally, before devising the corporate plan, the organization should keep in focus the activities, intentions and aims of their HR team. By involving the employees in the decision making processes of the organization the company can easily achieve the goals; this is primarily due to the fact that employees of such organizations consider themselves a part of the organization and due to this reason they put their best efforts to achieve the collective goals of the organization. They get to have a say in it rather than just processing orders for high level management. The general environment where employees are given a substantial authority enables not only a healthy working environment but brings in more diverse and fresh ideas. The management style that will be used in the company is affiliative. This type of manager takes time helping the team bond. In our company, the ground opinion and market research is really important. Customer feedback can help set better strategies and product designs; hence it is really important that top management communicate with low level managers and employees. Activities are set such that team gets caught up in getting to know each other. More task focused team members often look around and get anxious when they can see other teams working. This helps workers getting motivated and boosts their morale to work harder and pitch in more valuable ideas. We set bonuses for employees who work well in a given period of time which gives them an incentive to work better and more effectively. The structure of the organization states that there is a president to which three managers are directly reportable. Further managers are to report to these Vice presidents. The hierarchy shows that there is not much flow of command and everyone has a say in the company and its planning. Employees get a sense of responsibility and are held accountable which sets in a positive attitude in them and gives them a high morale to work harder and better in order to achieve goals and gain recognition or promotions. CONCLUDING REMARKS For any new business, it is essential that a detailed plan is prepared prior to its implementation. The paper written shows the organization and operational plan of a fictional organization. The paper also states the management and how it affects the business. However, it should be kept in mind that real life challenges are likely to arise, when business plans are implemented. For this reason, it is safe to say that planning is a continuous process which continues till the success of an organization and beyond. Read More