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The purpose of this report was to conduct a thorough analysis of Lawn cares operations management process and address whether Lawn Cares introduction to an application service would be beneficial or detrimental to the company as a whole. The evaluation of the effects an application service would have on Lawn cares strategic mission, strategy, competitive priorities, value chain and its customer sustainability has indicated that the introduction of an application service would, although cause an initial financial loss, ultimately benefit Lawn cares revenue and future stability. Through the use of diagrams and models, it was found that although Lawn care may suffer initial loss in terms of current customers and revenue, the adoption of an application service would expand our target market and services, leading to an increase in customers and ultimately resulting in an overall increase in net profit. After taking both the disadvantages and advantages of the introduction of an application service into consideration, it is recommended that it would be most suitable for Lawn care to adopt an application service to not only sustain superiority amongst competitors, but to maintain future sustainability and assist future growth.
Question 1: Define and discuss Lawn Care’s current strategic mission, strategy, competitive priorities, value chain, and how it wins customers. What are the order qualifiers and winners? (6 marks) 450-650 words
The current strategic mission of the company, Lawn Care as the Lawn Care Company case study demonstrates that the Lawn Care’s main strategic mission is to provide their customers with highest quality products as stated in the case study “highest quality grass seed and fertilizer” which clearly shows the Lawn Care main focus for their business has been to provide their customers with great quality of products. As Lawn Care want to have competitive advantage in the market amongst their competitors by providing the highest standard quality of products and providing their customer with superior quality products compared to other companies in the market. The competitive priorities of Lawn Care was to put strategic emphasis on quality which was the performance Lawn Care wanted to be an expert on so no other company could try to match even their product’s quality. As Collier and Evans (2012, p.75) explains that competitive priorities signifies the strategic emphasis that a company sets on certain performance measures and operational capabilities within value chain of the company and in this case it was place on quality by the Lawn Care as they considered in delivering customer with high standard of products.
Value chain agenda is the approach which company decided to analysis which tools to be used for strategic planning for meeting the firm’s goals as stated by (Walters &Rainbird, 2007). So in this case the value chain was design by the Lawn Care to strategically use all the business tools to achieve the highest level of quality of grass seeds and fertilizer and provide that to their customers. As Lawn Care firm were determine that if they provide their customers with high quality products, then the customers would not think about going to any other firms. So, this was the way by using which the Lawn Care decided to obtain customers and as well retain them. The order qualifiers according to (Collier and Evans, 2012) are the fundamental expectations of the customers, which are compulsory to be meet in order to sustain in the business, and it is minimum performance which any business must perform to stay in the business market. Collier & Evans (2012) states that order winners are the features and performance characteristics of products that differentiate one firm’s products from another firm’s product, over here in this case study he differentiating characteristic was quality of the product which Lawn Care produced compared with the other companies in the same business.
Question 2: Draw the major stages of the value chain with and without an application service and comment on the role of operations in each. (5 marks) 200-350 not including diagrams
The major stages of the value chain involving application service for Lawn Care would look like the following diagram below:
The diagram demonstrates the value chain that Lawn Care would be involved in if they would have application service in the business operational strategies.
This initial stage would involve in processes from collecting raw materials from suppliers, to product designing, making decision on how to operate the business, so this stage is involved in product designing to product development activitiesand to sort the inputs prepared to use for the production of end products.
This stage is the stages of production, which included from input of supply, to production process, product development activities, testing of the product, assembling of the product and to delivering the product to customers. So, it includes all those activities, which transform the inputs supplied by the suppliers into finished product. It also includes those activities involved in transferring of the finished goods to the customers such as transportation, distribution management, order fulfillments, production advertisement and promotion, retail management, etc.as described by (Slone, Dittmann & Mentzer, 2010).
Postproduction Activitieswould the application service stage, also known as after sales service. This is service, which is to assist the customer and retain the customer by proving them after sales service such as installation services, warranties, guarantees, and lawn repair or maintenance services, and online or over phone customer service, shipping as referred (Slone, Dittmann & Mentzer, 2010). These all services are going to help Lawn Care to retain their current customers and bundling their high quality product with application service would give them competitive advantage over their competitors in the market as all these services enhances the product’s value even after sale and thus helping to keep the customers as by providing post-production service Lawn Care would make their customer feel more important and build strong relationship between Lawn Care and their Clients. .
The major stages of the value chain without application service for Lawn Care would look like the following diagram below:
The initial stages in the value chain process would the phase where Lawn Care would be involved in preproduction service which to gain customers. According to (Collier and Evans, 2012) this stage would involved in the following things: Good and Service Design
Education and training services
Sales and marketing services
While at this phase Lawn Care firm would be involved in designing the product for the customerto product development activities, also it is the phase in which Lawn Care would get the inputs such as goods and raw materials from suppliers and this is also the stage were the firm would make all the business strategies and procedures as stated by Collier & Evans (2012). Value Creation
The next stage primary production process in the value chain process would the phase where Lawn Care would be involved in production service which to create value for the customers so that customers obtain the product from Lawn Care.It also includes those activities involved in transferring of the finished goods to the customers. Keeping Customers
The stage involved with “keeping customers”, Lawn Care are currently not very active in this stage as the without application service, there is no additional benefit which could be add to retain customers as there would no customer support after sale which means if the customers needs assistance with application for using equipment for the lawn, Lawn Care would not help them as they do not have any post production services. Thus, the customers would need to spend extra for any assistance, maintenance if required.
Question 3Define and discuss how the introduction of an application service
would mean to Lawn Care’s strategic mission, strategy, competitive priorities, value chain, and how it is likely to win customers. What are likely to be the order qualifiers and winners? (6 marks) 450-650 words
Lawn Cares current strategic mission as stated in the case study is to ultimately provide all customers with the “highest quality grass seed and fertilizer’ products(Collier and Evans, 2012). Currently, Lawn care’s primary focus had been on producing the highest standard product quality with minimal focus on adopting an efficient application service to apply this high quality product. The adoption of an application service will result in a big departure from their core business of Lawn care products manufacturer. The strategic mission would no longer focus primarily on the production of high quality products, but instead focus on the efficiency and required methods of using an independent application service. The introduction of an application service would make a big difference to its current value chain and strategy. Value is defined as ‘the perception of the benefits associated with a good, service, or bundle of goods and services in relation to what buyers are willing to pay’.
Currently Lawn care encompasses the traditional good producing methodology, which is to produce the “highest quality grass seed and fertilizer’ (Collier and Evans, 2012). However, to introduce an application service, Lawn care would have to expand their manufacturing company and invest funds into providing services in order to departure from the traditional good producing title. The integration of an application service will enable Lawn Care to provide the highest quality and personalized service as part of its customer value chain. If Lawn Care expands its services into not only being a supplier but also an applicator of their product they can ensure an increase in their target market and increase future revenue. In order to achieve this, Lawn care can adopt the Pre and Postproduction services to emphasize ‘the notion that service is a critical component of traditional manufacturing processes’ (Collier and Evans, 2012). The pre and postproduction services of a value chain provide a long-term strategy as it focuses on gaining a customer, value creation and most importantly keeping the customer. Lawn cares value creation process can focus on designing and customizing ‘high quality grass seed and fertilizer’ products as well as its postproduction services, which focuses on keeping the customer. This would involve a third party applying the products effectively and efficiently with the correct tools and methods to achieve customer satisfaction. The introduction of an application service wouldalso have a number of implications and effects on the five competitive priorities; ‘Cost, quality, time, flexibility, and innovation’ (Collier and Evans, 2012)’.
The introduction of an application service would include the need for trucks, mowers, weeders, sprayers, whipper snippers and personnel to maintain the golf courses, parks and lawns. These requirements would cause a drastic increase in Lawn Cares manufacturing and post-sale services cost. Although these tools would cause an increase cost in terms of reduced short run profitability, it will result in a higher perceived value leading to an increased market share. Furthermore,Lawn Cares applicator services would need to improve their speed and time reliability when providing services as time reductions often improve the quality, cost and productivity of their services. Finally the introduction of an application service would provide Lawn care with the opportunity to be innovative and flexible in terms of creating a wide range of high quality products and expand their services to all districts including professional parks, golf courses and residential areas which would ultimately allow them to differentiate from competitive seed and fertilizer suppliers. Lawn Care’s current order qualifiers are focused on manufacturing the ‘highest quality grass seed and fertilizer’ (Collier and Evans, 2012). The Order qualifiers include product delivery and shipping services to customers, and providing the ‘right product to the right customer at the right time’ (Collier and Evans, 2012). There would be a drastic change in Lawn Cares order winners as this category would entail the development and introduction of an application service that effectively and efficiently apply the high quality products.
This would mean that Lawn Care would have to increase their technology to suit such an application service and acquire the correct tools to implement their services. Although the introduction of an application service may cause the loss of a few current customers, as they would be targeting a new category of customer, in the long run the company would benefit in terms of expanding their target markets and long-term capital by providing both the highest quality product and service.
Question 4What are your final recommendations on whether Lawn Care should or should not proceed with the introduction of an application service and why? Lawn Care’s high quality products are currently being applied incorrectly and/or inadequately by third party applicators. This has a negative impact on the company’s revenue as the consumer could potentially be unhappy with the final product after the seed and fertilizer have been applied by an independent applicator who might not have detailed knowledge of the product. If Lawn Care expands its services into not only being a supplier but also an applicator of their product they can ensure that they increase their long-term profitability. An introduction of an application service would mean that Lawn care would suffer a loss in the number of current customers who would want to apply the products themselves. However, they could adopt an application service that provides customers with the option of personally applying the products or to have the products applied by a well-trained Lawn care applicator so that Lawn care could attract all market segments.
Although there would be a high increase in their expenditure, resulting in an increased selling price of product, an application service would allow the company to attract a larger portion of the market segments and hence increase long-term profitability. Another advantage of implementing the application service would be that this would give Lawn Care to break into the residential market as theresidential customers would always prefer a bundle deal rather looking for separate supplier for the fertiliser and separate installer so having the service application service would make Lawn Care more appealing to their clients as it would more convenient for the customers so that they do not need to waste their time in finding a separate installer. Thus, the recommendation for Lawn Care would be to implement the service application as it might increase their expenses and cost in short term but in long-term it would be profitable for the business as they would have competitive advantage over their competitors and also increase their profit by increasing the market size and also not only this would give them more customers but also help in retaining the existing customers.