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Key Topics
Requirement
Prepare an analysis that will identify the critical challenge or problem in the organisation,discuss the underlying root causes of the problem, prepare criteria against which to weigh alternative solutions, and present the recommendations and implementation plan.
Solution
Executive Summary
In this case analysis, we will discuss about a newly set up e-commerce company which has some major issues that are critical for the organization to survive for a long time in the market. This analysis deals with the probable resultants that may arise due to the related drawbacks and how the company will get affected adversely due to these drawbacks. Various types of solutions, suggestions and recommendations have also been mentioned in this case analysis which are very significant for the achievement of organizational goals and objectives.
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Statement of the problem
The problem is related to a newly set up electronic commerce company which allows the customers to do online shopping. The company is facing problem related to the data management of its customers. This problem has become critical for the company in its day to day working.
Analysis of the cause of the problem.
This e-commerce company is a newly set up company in the market. The company has started its operations and working recently with only 55 employees. Necessary care has been taken form the company in dealing with customers while they do online shopping. Easy options to go through the details of the product, related offers with the products, convenience in booking the product, reliable payment gateways, genuine reviews of the people who are using the particular product or have purchased the product, faster delivery services, helpful customer support services etc. are the most important sections on which the company has emphasized a lot and have considered these to be the most significant and critical, but the company has not taken enough initiative for the data management of its customers.
The company lacks in the proper collection and storage of customer’s data pertaining to their purchases; data like customer’s delivery address, contact numbers, alternate contact number, saving the credit card/debit card number by default which helps the customer to purchase a product without any hassle, purchase ID etc.(Koufaris & Hampton, 2004) These issues are critical for the company because the customers are facing lot of problem while booking the products as they have to enter their details each and every time they go for the purchase unlike other e-commerce companies that allow the customers to save their details for further purchasing. The company has started its operations but this particular section which seems to be very minor has been neglected by it which is affecting the company’s business severely. People are not showing interests in shopping with this company despite attractive offers on the products.
SWOT analysis
The strength of the company comprises of young & energetic employees, ample funds for the business, variety of offers and discounts on the products to attract customers and the innovative idea of providing a pick up point for its customers in case they are not able to collect their order at their home (these pick up point help the customers to collect their order/product from a different location near them if due to any reason they fail to collect it from the location given by them at the time of booking). These strengths are vital for organizational success.
The major weakness which lies with this company is its less number of employees and the company has not come up with adequate Customer Relationship Management (Jackson et al., 2003). The first weakness can be sorted when the company will explore to cover lot of people as it will require more staffs to be recruited, but the second weakness is very crucial for the company because this is leading to customer dissatisfaction thereby resulting to the downfall of company’s goodwill and reputation in the market. The company must concentrate on forming proper CRM.
The company has lot of opportunities to excel in the e-commerce market and attract a large number of people because it has offered various types of offers and has given bulk discounts on the products which are not available on other online shopping companies. The company can use the advanced technologies available in the market to speed up its operation process (Balamuralikrishnan & Dugger, 1995). This strategy will prove to be very helpful for the company to form a strong base and in capturing lot of consumers.
Possible threats to the companies could be: Other competitor companies are using advanced technologies to handle the customers which this company is not using or has not implemented them in its operations which may result to the failure of the company despite having all the expertise (Yuksel & Dagdeviren, 2007). This is a serious threat to the company’s existence in the market, so, the company must adhere to it and adopt the required technologies as soon as possible so that people do not get deviated to other companies. Also, due to its huge discounts, people will buy lot of products from the company which may create problem in accepting the orders & delivering the products at the specified time due to the less number of staffs.
Porter’s analysis
Porter’s five forces is a model used to identify and analyze the five force of the market that are significant in the determination of an industry’s strengths and weaknesses.
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Competition in the market: The company has lot of competition in the market. The rivals try to gain competitive advantages over other. Being a new company in the market, the company must try to use new and innovative ideas in order to minimize the rivalry and if the company achieves it, it can be concluded that the industry is well disciplined (Leape et al., 1995).
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Potential of new entrants into industry: This particular industry gives ample chance to new entrants to come and operate in the market because this industry does not require lot of capital to stat the business. Any firm with the vision to cover the market and with the help of new technologies can freely enter into the electronic commerce market and give tough competition to the competitor companies.
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Power of Supplier: The suppliers of products of this company have not a strong say due to the availability of lot of suppliers. Their bargaining power is not very good because various suppliers are present in the market that can be contacted anytime (Tsui et al.,1997).
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Power of the Company: The company has good bargaining power over the suppliers. E-commerce is a recent idea, so, the number of e-commerce companies are not very large i.e. they are quite less and this is the reason why the company has got good command over the suppliers and it can bargain up to any level as per its desire. Availability of bulk suppliers enables the company to bargain and give the tender to the supplier which fully fulfills the company’s need and requirement.
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Threat of substitute goods: In this industry, there is always a chance that a substitute good can appear in the market with low price and is more satisfying than the good which is more costly than it is (Porter, 1981). For example, if the company is selling Toshiba laptops which are of high range and later on Asus which is also a very good computer company launches its cheaper laptop variants with better specification then people might go for Asus laptops. This creates a serious threat to Acer computer market.
Above are the two most important theories which are helpful to understand the broader perspective of electronic commerce industry and also provides each and every minute detail pertaining to this newly set up company.
Decision Criteria and Alternative solution
When we consider other top e-commerce companies like Amazon, eBay, Walmart etc. that are operating at a good pace, we see that the path and the ideas which these companies have followed to attract people are unmatchable. The criteria against which I will evaluate the possible reasons that I feel this particular company is going through the issues are as follows:
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Team Spirit: Team spirit is very important for an organization to prosper and grow in the desired way. A good team spirit leads to the achievement of the organizational goal. When employees work collectively in a team, they work with full confidence to achieve their set target because the team members act as motivational source for each other. When I consider this new e-commerce company, I see that the company is lacking in team spirit. Teams like sales, marketing, advertisement etc. are not made as per the need which leads to degradation in company’s goodwill and market share.
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Technology used: Various types of technologies are used to make the online shopping more convenient and user friendly. Nowadays, companies have come up with mobile applications to make shopping more easy and hassle free. As far as this company is concerned, the company has not made its mobile shopping application yet which is creating a problem for the customers to access the company’s website because these days everybody uses his/her smart phones for shopping rather than browsing the company’s website
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Customer Support: As this company is new, there are not enough staffs to help the customers either online or on calls. The company has limited employees who face lot of word loads most of the time which leads to customer dissatisfaction as they have no other option than to be on wait for their turn to come. This makes them feel irritated which adversely affect the company market credibility (Wolfinger & Sotola, 2002).
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Time Bound Deliveries: The company fails to deliver the booked products to the customers as per the mentioned time because of the less number of delivery boys. The company needs to recruit more people for this job to maintain their credibility and repo in the market.
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Customer’s Data: This company has not got an appropriate tool or software to save and keep the record of the purchases done by the customers. This leads to chaos as sometimes company needs these records for analysis, also, customers do not want to enter their basic detail each and every time they go for purchasing online. Therefore, the company should use some good tools like cloud computing or data storage devices to keep a proper record of the data of the customers (Kobsa et al.,2001).
Probable solutions to eliminate these issues would be as follows:
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The company should hire more employees for all the departments like sales, marketing, human resource, finance, advertisement etc. so that the teams could be made to counter the prevailing issues. This will help the company to have specialists and professionals that can give their expertise and share their skills in proper decision making.
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The company must introduce a good customer relationship management so that the customers may not face issues while shopping online.
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The company should try to make its shopping application for smartphones as this will allow the users to shop easily. This will also attract more users to come across the company and its product as the majority of people of the contemporary era are using smartphones and mobile application instead of browsing websites.
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All the relevant and necessary technologies must be used by the company to give tough competitions to the competitors which will also help the company to establish its goodwill in the e-commerce market in a short time span.
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Place Your OrderConclusion, Implementation and Justification
From the above discussions it can be concluded that this newly set up e-commerce company lacks in so many areas majorly in customer relationship management. This particular section is the crux of online shopping because these days, people prefer and expect the companies to save their basic details like shipping addresses, contact numbers, credit card/debit card details etc. so that they need not enter in every time they go for online shopping. If they are asked to enter these information every time, it makes them feel tiresome and they ignore shopping. The company also lacks in giving proper customer support to its customers. The tele-callers are very few in number which creates a problem for the customers who are willing to seek customer support by speaking to them. Finally, due to the less number of delivery boys, the company faces problems in delivering the products to the customers, especially, when the company gets profusion of orders pertaining to the offers and discounts given on the products. In this situation, the company fails to give severity and turnaround time to the customers due to the heavy workload on the delivery boys.
The company should adhere to the probable solutions which have already been discussed earlier. Every new company tries to follow the footsteps of the top companies in the particular industry and if the company has some innovative ideas apart from the basic then it adds a fragrance in its success. The company must go for a survey in order to ascertain its strengths and weaknesses as compared to its rivals, so that, it can work and take decisions accordingly keeping in mind the organizational aims and objectives. The implementation of the appropriate solutions will help the company to grow and excel well in the market, it will also help to attract more and more customers.
The top management of the company should consult the experts on how to implement the solutions. The top and middle-level management are of prime importance in dealing with the issues and in curbing them.
The management should without any delay apply the recommendations as this will lead to correct and check the drawbacks which have the potentials to severely affect the company. These limitations can also question the company’s future existence in the market therefore these must not be ignored and neglected. If the organization feels that it will take time for them to implement the solutions like making mobile application, hiring more employees, adopting technologies etc. then the company should hire people possessing the required skills and expertise on temporary basis for time being so that the organizational operations do not get hampered.
References
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Koufaris, M., & Hampton-Sosa, W. (2004). The development of initial trust in an online company by new customers. Information & management, 41(3), 377-397.
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Jackson, S. E., Joshi, A., & Erhardt, N. L. (2003). Recent research on team and organizational diversity: SWOT analysis and implications. Journal of Management, 29(6), 801-830.
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Balamuralikrishna, R., & Dugger, J. C. (1995). SWOT analysis: A management tool for initiating new programs in vocational schools.
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Yüksel, ?., & Dagdeviren, M. (2007). Using the analytic network process (ANP) in a SWOT analysis–A case study for a textile firm. Information Sciences, 177(16), 3364-3382.
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Leape, L. L., Bates, D. W., Cullen, D. J., Cooper, J., Demonaco, H. J., Gallivan, T., ... & Nemeskal, R. (1995). Systems analysis of adverse drug events. Jama, 274(1), 35-43.
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Tsui, A. S., Pearce, J. L., Porter, L. W., & Tripoli, A. M. (1997). Alternative approaches to the employee-organization relationship: does investment in employees pay off?. Academy of Management journal, 40(5), 1089-1121.
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Porter, M. E. (1981). The contributions of industrial organization to strategic management. Academy of management review, 6(4), 609-620.
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Wolfinger, C., & Sotola, R. (2002). U.S. Patent No. 6,415,259. Washington, DC: U.S. Patent and Trademark Office.
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Kobsa, A., Koenemann, J., & Pohl, W. (2001). Personalised hypermedia presentation techniques for improving online customer relationships. The knowledge engineering review, 16(02), 111-155.
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