Evaluate the effectiveness of techniques used when developing strategic business plans

Unit Aim The aim of this unit is to give learners the knowledge and understanding of how a business unit can strategically organise and plan for likely future outcomes in order to be successful.
Learning Outcome 1. Understand the process of strategic planning

Learning Outcome Learning Outcome Assessment Criteria In this assessment you will have the opportunity to present evidence that shows you are able to: Task no.
Evidence
(Page no)
LO1 Understand the process of strategic planning 1.1 assess how business missions, visions,
objectives, goals and core competencies
inform strategic planning 1 (Report)
1.2 analyse the factors that have to be considered when formulating strategic plans
1.3 evaluate the effectiveness of techniques used when developing strategic business plans

Learning Outcome 2. Be able to formulate a new strategy
Learning Outcome Learning Outcome Assessment Criteria In this assessment you will have the opportunity to present evidence that shows you are able to: Task no.
Evidence
(Page no)
LO2 Be able to formulate a new strategy 2.1 analyse the strategic positioning of a given
organisation by carrying out an organisational
audit 2 (Report)
2.2 carry out an environmental audit for a given organisation
2.3 explain the significance of stakeholder analysis
2.4 present a new strategy for a given
organisation 3 (Article)

Learning Outcome 3. Understand approaches to strategy evaluation and selection
Learning Outcome Learning Outcome Assessment Criteria In this assessment you will have the opportunity to present evidence that shows you are able to: Task no.
Evidence
(Page no)
LO3 Understand approaches to strategy evaluation and selection 3.1 analyse the appropriateness of alternative
strategies relating to market entry,
substantive growth, limited growth or
retrenchment for a given organisation 3 (Article)
3.2 justify the selection of a strategy

Learning Outcome 4. Understand how to implement a chosen strategy

Learning Outcome Learning Outcome Assessment Criteria In this assessment you will have the opportunity to present evidence that shows you are able to: Task no.
Evidence
(Page no)
LO4 Understand how to implement a chosen strategy
4.1 assess the roles and responsibilities of
personnel who are charged with strategy
implementation 4 (Report – table format)
4.2 analyse the estimated resource requirements
for implementing a new strategy for a given
organisation
4.3 evaluate the contribution of SMART targets to
the achievement of strategy implementation in
a given organisation.

Guidelines
• Please note AC 2.4 is required in the article with AC 3.1 & 3.2
• You are required to submit all tasks 1, 2, 3 and 4 as a single word document (As explained by the tutor)
• Ensure that all work had been proof-read and checked prior to submission.
• Ensure that the layout of your documents is in a professional format.
• Ensure that all references are quoted at the end of the document using Harvard referencing
• Ensure that you complete the assignment cover sheet with your details, the unit details and your lecturer’s name. (Please sign the statement of authenticity)
• It is advisable for you to keep a copy of your assignment for your own record

Report Formatting Guidelines:

• Use a report format (According to the structure explained in the class)
• Use diagrams and tables of figures where appropriate and reference their source
• Word process the assignment and justify the margins; 1.5 line spacing
• Use 12 point on Times New Roman or Arial script

Plagiarism Policy:
Students must not simply copy materials from other students, past or present, from written sources, from the Internet, or from any other source whether this is through cutting and pasting, rewriting or by any other means. Changing a few words within a copied piece of text does not render this original and still count as plagiarism. In short, work submitted by students must be their own unless it is specifically indicated within the text through appropriate referencing that this is not the case – or where originality was clearly not a requirement of the assessment being undertaken.

Assignment Brief

This Assignment will focus on a recent development in the construction industry reflecting on the strategic excursion of one of UK’s leading construction company ‘Lafarge Tarmac’.

You are required to use the video clip (see link below) and case study (pages 3-4) for LO1, LO2, LO3 and LO4, and apply all the knowledge you gain, to the Learning Outcomes and the Assessment Criteria. The format for each task will vary. The video clip and case study only offer some information, so further research is required to enable the production of more detailed information in the assignment.

Video Clip: https://www.youtube.com/watch?v=6xbyrj-qBDY (1:54 minutes long)

Title of the video: Readymix – Lafarge Tarmac – You Tube

Case Study – LAFARGE TARMAC (2014)

About Lafarge Tarmac
In 2011 an agreement started in the construction Industry which resulted in the formation of Lafarge Tarmac a joint venture company formed following the fusion of Lafarge UK and Anglo American’s Tarmac business, to create the UK’s leading construction materials and services company.

The company is a 50:50 joint venture, equally owned by Lafarge and Anglo American plc, combines both company’s cement & lime, aggregates, ready-mix concrete, asphalt and asphalt surfacing, maintenance services, and waste services businesses.

Launch of Lafarge Tarmac
Lafarge Tarmac began trading on 7th January 2013, following final clearance from the UK Competition Commission. The clearance predicated on the completed sale of a portfolio of Tarmac and Lafarge construction materials operations in the UK. Lafarge Tarmac had been forced to sell its £272m Hope cement plant in Derbyshire to Lakshmi Mittal, the steel magnate, to win approval for its creation in 2011.
The Lafarge Tarmac combination is expected to generate synergies of £60 million through improving operational logistical and purchasing efficiencies and the introduction of value-added products across a wider geographic area.
Mr. Greenwood informed that after nearly two years of planning and speculation, the challenge was to integrate the two companies’ offerings into one and bring the best aspects of both businesses. He informed that the greatest challenge facing Lafarge Tarmac is the economy and the uncertainty it brings. Growth in this climate is always going to be a test, but the company is looking to its new identity to help provide that.
Defining company strategy
As the company works through its first months after the joint venture, many in the industry and outside it are keen to find out how it will affect company strategy and operations. “The joint venture was company strategy – we’ve taken the legacy of what both companies were trying to achieve and aim to get the best from each.”
‘For Lafarge, this was innovation, good customer service and technical expertise, while Tarmac brought its strong heritage of plant networks and access to raw materials’. Mr. Greenwood informed. The union:
• allows the coming together of Tarmac aggregate business and the Lafarge concrete business. ‘The Lafarge Group has been developing low-carbon traditional cement, and the Ready-mix business can bring the two strands together’.
• aids the company working on all types of projects across the country through 17 local centres.
• gives economies of scale, a more integrated supply chain and a better footprint.
Making concrete sustainable
Mr. Greenwood highlighted sustainability as a potential growth area for the business and for the concrete industry as a whole. “We’re doing lots of work on sustainable products and systems, and we see this as a big opportunity not as a challenge.”

Cynthia Carroll, Chief Executive of Anglo American, said: “We have successfully united two high quality and complementary UK businesses to create the leading UK construction materials company, with high quality assets, two experienced management teams, and a portfolio of well-recognised, innovative brands.”
Bruno Lafont, Chairman & Chief Executive of Lafarge, said: “The closing of this transaction and the creation of a new British construction materials champion reinforces Lafarge’s ongoing commitment to the UK market and its efforts to continuously improve its offering to customers, as well as playing a full role in developing the infrastructure needed for a growing economy.”(Anglo American 2013).

Lafarge Tarmac fusion as one company

Following the completion of the joint venture the Managing Director of the company’s Ready-mix division (Jeremy Greenwood) was asked about company strategy, making concrete sustainable and searching for growth in the economy.
He informed that the company achieves sustainability by:
• reducing the embodied carbon in cement products by around 22 per cent.
• using waste-derived fuels in cement plants to significantly reduce reliance on fossil fuels and ensure net-usage of waste.
• working in partnership with specifiers early in the design process to adopt a considered approach to building design, helping to maximise the thermal mass of concrete to lower a building’s in-use energy consumption throughout its lifecycle.
“We want to grow through innovation and thinking about things differently – and also through early contractor involvement, looking to reduce the cost of the construction process also through innovation and exploring sustainability further,” Mr. Greenwood says. (cnplus.co.uk – Katie Barker: 29, March 2013)
UK Watchdog steps in a second time
The Financial Times reported on January 14th, 2014 that ‘A potential £2bn flotation by Britain’s largest cement maker could be delayed after the Competition Commission confirmed that it would force the company to sell assets in the UK. It is concerned that the way the cement sector operates aids coordination between three major players − Lafarge Tarmac, Cemex and Hanson − and is likely to result in higher prices. Commission deputy chairman Professor Martin Cave said: “We think that these measures will go a long way towards establishing a more competitive market for customers.
Lafarge Tarmac may now be forced to sell either its Cauldon cement works in Staffordshire or Tunstead in Derbyshire. Lafarge’s chief executive, UK, Cyrille Ragoucy, said he was “disappointed” by the decision, adding it was “not reasonable or proportionate”.Both cement makers have filed separate appeals against the Competition Commission’s ruling and are considering taking their fight to the courts.

Task One: (Learning Outcome 1)

Scenario 1:
You are working as a Strategy Development Manager for Lafarge Tarmac and you are responsible for ensuring that the Competition Commission and the stakeholders of the company understand the process of strategy planning in the organisation.

Prepare a report (approximately 1000-1500 words) consisting of the following:

1.1 Assess how Lafarge Tarmac’s missions, visions, objectives, goals and core competencies inform strategic planning

You need to consider:
a) role of strategy, mission, vision, objectives, goals and core competencies in the context of Lafarge Tarmac

1.2 Analyse the factors that have to be considered when formulating strategic plans at Lafarge Tarmac

You need to consider:
a) Strategic planning issues: impact on managers; targets; when to plan; who should be involved; role of planning
b) Strategic thinking: future direction of the competition; needs of customers; gaining and maintaining competitive advantage; Ansoff’s growth-vector matrix; portfolio analysis
c) Planning systems: informal planning; top-down planning; bottom-up planning; behavioural approaches

1.3 Evaluate the effectiveness of techniques used when developing strategic business plans at Lafarge Tarmac

You need to consider:
a) Using appropriate tools for the growth-share perspective of the organisation
(Apply at least two Strategic planning techniques to the company’s business units: BCG growth-share matrix; directional policy matrices; SPACE)

(This provides evidence for AC 1.1, 1.2 & 1.3)

Task Two: (Learning Outcome 2)

The joint venture is expected to allow the company to increase its competitive advantage in the UK. Cynthia Carroll, Chief Executive of Anglo American, said: “We have successfully united two high quality and complementary UK businesses to create the leading UK construction materials company, with high quality assets, two experienced management teams, and a portfolio of well-recognised, innovative brands.” (Anglo American 2013)

Scenario 2:
Two years after the joint venture, under the watchful eye of the competition commission and the profit driven shareholders, your department has been asked to prepare a report (approximately 1000-1500 words) consisting of a few in-depth audits that will help them to make an informed decision to formulate a new strategy. You are also required to inform how Lafarge Tarmac is currently positioned strategically.
(Further research into the company is vital with fully supported evidence and examples showing how the audits are useful).

2.1 Analyse the strategic positioning of Lafarge Tarmac by carrying out an organisational audit

Here you will need to consider at least four of the following organisational audits:

The organisational audit: benchmarking; SWOT analysis; product positions; value-chain analysis; demographic influences; scenario planning; synergy culture and values.
(mandatory organisational audits – SWOT analysis & Value Chain Analysis)

Further identify how the company is strategically positioned:

Strategic positioning: the Ansoff matrix; growth; stability; profitability; efficiency; market leadership; survival; mergers and acquisitions; expansion into the global marketplace)
(Mandatory strategic positioning – relevant strategies in Ansoff Matrix must be used)

2.2 Carry out an environmental audit for Lafarge Tarmac

Here you will need to consider the following:

Environment auditing: political, economic, socio-cultural, technological, legal and environmental analysis (PESTLE); Porter’s 5 force analysis; the threat of new entrants; the power of buyers; the power of suppliers; the threat of substitutes; competitive rivalry and collaboration)

2.3 Assess the significance of stakeholder analysis when formulating new strategy

At the end of the audits, you will need to consider the following:

Stakeholder analysis: stakeholder significance grid; stakeholder mapping)
(This provides evidence for AC 2.1, 2.2 & 2.3)

Task Three: (AC 2.4 & Learning Outcome 3)

The Financial Times reported on January 14th, 2014 that ‘A potential £2bn flotation by Britain’s largest cement maker could be delayed after the Competition Commission confirmed that it would force the company to sell assets in the UK. Commission Deputy Chairman Professor Martin Cave said: “We think that these measures will go a long way towards establishing a more competitive market for customers. Lafarge’s Chief Executive, UK, Cyrille Ragoucy, said he was “disappointed” by the decision, adding it was “not reasonable or proportionate”.

Based on the audits the strategy department has prepared for the competition commission and the shareholders, write an article (approximately 1000-1500 words) to be published in the Financial Times that will allow readers to understand approaches to strategy evaluation and selection.

3.1 Analyse the appropriateness of alternative strategies relating to market entry, substantive growth, limited growth or retrenchment for Lafarge Tarmac

The article should indicate:
a) the current market entry / substantive growth/ limited growth strategies being used by Lafarge Tarmac (making emphasis of the advantages and disadvantages the company experiences)
b) the disinvestment strategy that the competition commission is once again proposing (highlight the impact the strategy has and will further have on the industry as well as on Lafarge Tarmac)
c) Identify at least three strategies, from the alternative strategies which you recommend that could be looked at from perspectives of the competition commission and the shareholders.

You need to consider:
Market entry strategies: organic growth; growth by merger or acquisition; strategic alliances; licensing; franchising

Substantive growth strategies: horizontal and vertical integration; related and unrelated diversification

Limited growth strategies: do nothing; market penetration; market development; product development; innovation

Disinvestment strategies: retrenchment; turnaround strategies; divestment; liquidation
(You need to show evidence of research and a variety of sources, as this will strengthen the report).

2.4 Present a new strategy for Lafarge Tarmac
&
3.2 Justify the selection of a strategy for Lafarge Tarmac

a) As the strategy development manager, highlight one strategy from the alternative strategies which you consider would be the most feasible, desirable and suitable for Lafarge Tarmac.

You need to consider:
Strategy selection: considering the alternatives; appropriateness; feasibility; desirability)

Task Four: (Learning Outcome 4)

Based on the chosen strategy, prepare a report in the format of detailed tables to be presented to the board of directors of Lafarge Tarmac on how the department would implement the chosen strategy. (see table templates attached)

The tables should reflect on:

4.1 Assess the roles and responsibilities of personnel who are charged with strategy implementation at Lafarge Tarmac

You need to consider:
a) what the strategy implementation would mean to the operation of the business (culture, systems & structure)
(see template of table 4.1a)

b) The Strategy Practice Model
• WHO would be the strategists?
• What would be the responsibility of the strategists in carrying out the strategy?
• Which methods could be used to communicate the strategy?
(see template of table 4.1b)

Guidance:
The realisation of strategic plans to operational reality: communication (selling the concepts); project teams; identification of team and individual roles, responsibilities and targets; programme of activities; benchmark targets at differing levels of the organisation

4.2 Analyse the estimated resource requirements for implementing a new strategy for Lafarge Tarmac

You need to consider:
a) Resource allocation: finance; human resources; physical resources (materials; marketing; IT); time, required to effect the strategy chosen in 3.2 for Lafarge Tarmac
(see template of table 4.2)

4.3 Evaluate the contribution of SMART targets to the achievement of strategy implementation at Lafarge Tarmac.

(Identify at least three targets and evaluation tools to achieve strategy implementation
(see template of table 4.3)

You need to consider:
Review and evaluation: an evaluation of the benchmarked outcomes in a given time period in relation to corporate, operational and individual targets – How will Lafarge Tarmac ensure that the chosen strategy is working? What can they do/use to monitor

(This provides evidence for AC 3.1, 3.2, 4.1, 4.2 & 4.3)

In addition to the above PASS criteria, this assignment gives you the opportunity to submit evidence in order to achieve the following MERIT and DISTINCTION grades

Grade Descriptor
Indicative characteristic/s
Contextualisation
M1 identify and apply strategies to
find appropriate solutions effective judgements have been made

complex problems with more than one variable have been explored

Evidence of ability to recognise and apply strategies through effective decisions made in areas where analysis of data collection have been made.

One should be able to appropriately apply more than one planning techniques to the organisation in LO1.
M2 select/design and apply appropriate methods/techniques relevant theories and techniques have been applied

a range of methods and techniques have been applied

a range of sources of information has been used Conclusions are drawn by linking theoretical standpoints on a range of audits from different sources to the organisation particularly in LO2.

Referencing is shown from a variety of sources from which information was obtained.
M3 present and communicate appropriate findings A range of methods of presentation have been used and technical language has been accurately used

Communication is appropriate for familiar and unfamiliar audiences and appropriate media have been used. The assignment is presented in the required formats LO1 – presentation slides; LO2 – report; LO 3 – Article and LO 4 – report in table format.
It should consist of accurately used business terminologies.

D1 use critical reflection to evaluate own work and justify valid conclusions conclusions have been arrived at through
synthesis of ideas and have been justified

self-criticism of approach has taken place

The data researched and put together on the alternative strategies in LO3 have led to justifiable conclusions of the chosen strategy
Critical evaluation of the work shows the consideration of possible alternatives that could have been considered.
D2 take responsibility for managing and organising activities autonomy/independence has been demonstrated

substantial activities, projects or investigations
have been planned, managed and organised

activities have been managed

the unforeseen has been accommodated

the importance of interdependence has been
recognised and achieved Show the ability to develop ideas to a profound level of understanding, application and analysis, hence providing relevant judgments and opinions.
This can be demonstrated by one’s ability to combine directed learning and self-managed learning. For example working ahead to complete assessment criterion 2.2 & 2.3 which consist of areas in which learners would have already have some knowledge of the theory prior to lecture deliveries.

Manage work within specified deadlines for example submitting assignment drafts in reasonable time before deadline.

D3 demonstrate convergent/lateral/creative
Thinking ideas have been generated and decisions taken

self-evaluation has taken place

convergent and lateral thinking have been applied

•innovation and creative thought have been applied

receptiveness to new ideas is evident

effective thinking has taken place in unfamiliar
contexts.
Demonstrated the ability to apply lateral thinking by applying a variety of theories to practice in particularly LO 4 which incorporates the reflective approach to learning in order to implement and evaluate the chosen strategy.

An indication that a lot of research and analysis has been incorporated for a company that may be unfamiliar to the learner.

4.1 Assess the roles and responsibilities of personnel who are charged with strategy implementation at Lafarge Tarmac

Table 4.1a – Provide theoretical evidence to support what strategy implementation would mean to the operation of the business
Strategy Implementation Business Operation
(The impact of strategy implementation on the operations of the Business)
Culture

Structure

Systems

Table 4.1b Use the The Strategy Practice Model to identify the roles and responsibilities of personnel who are charged with strategy implementation at Lafarge Tarmac and state which methods could be used to communicate the strategy

Strategists (Who?) Activities (What?) Methodologies (Which?)

Table 4.2 Analyse the estimated resource requirements for implementing a new strategy for Lafarge Tarmac

Type of resources required Access to / availability of resources Constraints/ obstacles that may affect the implementation

4.3 Evaluate the contribution of SMART targets to the achievement of strategy implementation in Lafarge Tarmac

Targets (corporate, operational & individual) to be reviewed and evaluated SMART principles (specific, measurable, achievable, realistic and time constrained) Tool of evaluation/control and its suitability to evaluate/control the target

Reading lists:

Johnson, G., Whittington, R. and Scholes, K. (2011). Exploring Strategy: Text and Cases. 9th edition. Pearson Education. ISBN 9780273732020.

BPP Learning Media (2007). Business Essentials – Unit 7 Business Strategy. BPP Learning Media. ISBN 9780751744798.

Grant, M. R. (2007). Contemporary Strategy Analysis. Wiley-Blackwell. ISBN 9781405163095.

Websites:

● www.bized.co.uk: Bized provides a selection of teaching and learning resources
● www.bloomberg.com: Bloomberg Business and Financial news
● www.businessballs.com: Businessballs is a free ethical learning and development resource. Free materials, articles and ideas for team roles and leadership
● www.emerald-library.com: Independent publisher of global research
● www.fsb.org.uk: The Federation of Small Businesses
● www.ft.com: The Financial Times business sections
● www.hemscott.net: Share prices, stocks, investing and company information

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