Business Model and Strategic Plan Part I:
Conceptualizing a New Product or Service Division of an Existing Business The company that will be used for purposes of this essay is Micron Technology Inc. Any company that is in the technology sector is hinged on innovation. Its ability to do so or lack thereof is a key factor in its growth and success. Consequently, its core focus is on resources that continuously ensure its ability to create and innovate as this is a huge determinant of its relevance in the market. Mission, Vision, and Values
Micron Technology Inc. has a rich history of over thirty years in the semiconductors and other electronics components industry. Micron’s mission is to be the preferred provider of semiconductor solutions globally (Micron, 2015). Its vision is centered on its ability to redefine innovation and consistently development the world’s most advanced technologies in the semiconductor and memory industry. Its values include: integrity, innovations, and equal employment opportunities. These values have been used to coin the company slogan which states that one’s innovation is Micron’s memory (Micron, 2015). The company’s values are best described in the following statements: • Leadership based on accountability, teamwork and trust
• Embracing business volatility
• Decisions are reached through metrics, data and processes • As a company, the core focus is on the needs of the customer • Innovating to meet market demands
• Efficiency in operations and service delivery (Micron, 2015)
Business Model for New Division
A business model provides a simple explanation of how a company makes money. Considering that Micron’s core business is in the semiconductor industry, the business model will revolve around innovation. New ideas on semiconductor technology is what the division relies on. As such, the lack of the same will lead to the division becoming redundant. Consequently, it is necessary to ensure that the division is staffed with the right resources. These will largely consist of researchers, scientists and visionaries who will be tasked with consistently coming up with new innovation and technology that will help the company meet market demands while at the same time set it apart from its competitors as it will always produce technology that is ahead of its time. The division’s mission statement is innovation to make life easier. As such, new technology developed will focus on the memory and semiconductor industry (Micron, 2015). As Micron controls over twenty percent of the global market in this industry, the division has a competitive advantage owing to market share. The diagram below is an illustration of the division’s businessplan. Business model
Identifying Customer Needs and Achieving Competitive Advantage
The success of a product is largely dependent on its ability to meet a customer’s needs (Power, 2013). Where this is lacking, it becomes difficult to convince customers that they need your product. A company would be running a high risk of failure of it chooses to base its operations on the premise that innovation reveals what the customer needs and not the other way round. The challenge comes in the fact that customer needs are dynamic. As such, an organization needs to have a strong grasp of what’s hot and what’s not. The only way to achieve this is to communicate with the customer. Get to know what they have to say and this will make it possible for you to not only innovate but also have business success (Power, 2013).
An element that determines business success is competitive edge. The division’s competitive edge is hinged on its ability to offer products that are unique and that appeal to a need in the market (Balanced Scorecard Institute, 2014). This can be achieved by launching new products in their niche market in storage and semiconductors. The price also influences how receptive customers will be to the new product. Not only must it meet a need but it must be affordable. Division’s Strategic Plan
The core elements in this plan are the Key Performance Indicators that will be used to monitor the division (Lavinsky, 2013). These are critical as they will ensure that the division remains true to its mission, vision and values. One indicator can be customer feedback which is generated through market research. This will help the division narrow down on ideas of which products will be relevant to the market and which ones will not.
Reports that focus on the progress of the division in terms of the number of new ideas, presented, tested and rolled out in the form of finished products (Balanced Scorecard Institute, 2014). Other reports that can be used include employee appraisals to ensure that the team within the division is well suited to the task. Otherwise, the Division will encounter much difficulty in rolling out new products or completely fail.
Goals are integral in helping the company set timelines for fulfilling their core mission (Balanced Scorecard Institute, 2014). The division will focus on goals that focus on the generation of new ideas and how long it takes for these ideas to become business successes. As such, long term and short term goals must be clearly outlined.
A SWOT analysis is also an important aspect of the strategic plan as it helps management anticipate challenges, take advantage of opportunities and mitigate risk (Balanced Scorecard Institute, 2014). These are key elements that determine business success. The division’s strength lies in its innovative nature. The weakness of this is the lack of expertise to understand customer needs. This creates an opportunity to strengthen the team y including a team whose core purpose is market research and interaction with customers to understand what the market needs. The threat this poses is product failure once it hits the market as it fails to meet the needs of customers. Marrying the Vision’s Mission, Vision and Goals with that of Micron Inc.
Micron’s mission is to be the preferred provider of semiconductor solutions globally (Micron, 2015). The company has endeavored to retain a substantial market share through mergers and acquisitions that were all geared towards strengthening its innovativeness and business strength. As the new division’s mission is hinged on innovation to meet the needs of the consumer, it compliments Micron’s focus which is to be the preferred provider of semiconductor solutions. As such, the division would be of benefit to Micron as it would help them further diversify their product ranger in terms of newer and more improved versions as opposed to maintaining the status quo as far as research and development is concerned. The end result is Micron fulfills its core mission, vision and values which are hinged on innovation and ideas. The Division’s Strategic Plan and its Relationship to the Mission, Vision and values of Micron Inc.
A strategic plan serves as a road map of how an organization will accomplish what it outlines in its vision and mission (Balanced Scorecard Institute, 2014). As the division’s core function is coming up with new products, it contributes to micron’s vision of ensuring that it continues meeting customer’s needs by coming up with better products that are relevant for the semiconductors and memory market. The Division’s Guiding Principles in relation to Social Responsibility, culture and Ethics
Micron has openly stated that it is committed to conducted business with integrity (Micron, 2015). Reputation has the power to make or break a company. Many organization’s recognize this and in response seek to affirm the community that they are dedicated to upholding positive values and business ethics. This is done through ensuring that the products they produce are of good quality and also taking part in activities aimed at community development. Such activities are viewed as corporate social responsibility.
As the division has borrowed its values from Micron, its focus includes delivery of products that are of good quality as well as participating in programs and activities that seek to improve the community where the organization is based (Micron, 2015). The Micron Foundation endeavors on adding value to the community while at the same time encouraging the development of innovation and technology. The development of effective education programs has made this a reality in the different parts of the country where the company has its operations.
The end result is the community is more receptive to the company. This has a ripple effective as the company improves its public image which contributes to brand strength (Balanced Scorecard Institute, 2014). Market penetration becomes easier and the establishment of a loyal customer base. People tend to trust organizations that they feel have positive values practice business ethics. This is to some degree why the company values tend to reflect on values and characteristics associated with ethics. It is much easier for customers to trust a company that includes the words integrity and quality in its mission, vision and values as opposed to one that fails to consider basic terms that are associated with ethics. A proven fact in today’s business world is that social responsibility sells. Companies are aware that when they give back to the community they woo more customers. This has resulted to corporate social responsibility being a norm in the business world.
Balanced Scorecard Institute. (2014). Strategic Planning Basics. Retrieved from balancedscorecard: http://balancedscorecard.org/Resources/Strategic-Planning-Basics Lavinsky, D. (2013, October 18). Strategic Plan Template: What To Include In Yours. Retrieved from Forbes: http://www.forbes.com/sites/davelavinsky/2013/10/18/strategic-plan-template-what-to-include/ Micron. (2015). Jobs at Micron. Retrieved from micron.com: http://www.micron.com/jobs Micron. (2015). Our Company. Retrieved from micron.com: http://www.micron.com/about/our-company Power, D. (2013, February 19). Customer needs should drivve innovation. Retrieved from harvard.edu: http://www.dce.harvard.edu/professional/blog/customer-needs-should-drive-innovation