Final Business Model and Strategic Plan: C.H. Robinson Worldwide Inc.

free essayC.H. Robinson Worldwide Inc. became a publicly-traded company in 1997. The company’s new marketing service division aims for offering marketing services based on the types of products transported or rendered into market sectors. The company has formed a separate business division as a means of cultivating a competitive market advantage. Starting on this division gives the company an opportunity to expand without considerably adjusting the company’s present corporate structure. The marketing service division can start operating within a few days after funding. The existing plan requires opening each sub-division and running the entire company all within the same geographical zone so as to motivate staff and management members to training, accounting techniques, and inventory management strategies. The division takes care of the development and employment of an integrated and strategic marketing plan.

The division also takes care of the establishment of the company’s advertising strategy, designing and implementing tactical advertising and promotional activities. It helps, in addition, in producing the company’s flagship publications and ensuring the consistency and cohesiveness in all publications across the company. It satisfies the marketplace needs as well. The marketing service will meet the marketplace needs by bringing the target customers up to speed with the company’s specifics and mode of operation. The business will have the competitive advantages such as its strategic location, professional workers, effective operations, or capacity in order to bring values for the success of the business to the clients.

The vision of C.H. Robinson Company is to offer best and timely freight services, tools, and methods (C.H. Robinson Worldwide Inc. Earnings Conference Call, 2014). Like the company’s vision and mission, the marketing service division also targets at impressing the customers and achieving a competitive advantage through well-strategized marketing schemes. In the future, the division aims for being a world-class and most preferred company for best customer services globally. The business will create a great advantage over competitors gained by granting greater value to customers, either through lower prices or by offering greater welfares and services that warrant higher prices. To maximize profitability, C.H. Robinson Company Inc. will consolidate all of its operations into one location, giving an excellent entrance to the bigger industrial markets.

Existing Business or New Business Division; Vision, Mission, and Value Proposition

Planning is considered to be the most tactically significant resource and the most strategically important ability for business firms in general management. Nevertheless, several initiatives being carried out to develop and utilize organizational knowledge are not clearly connected to or outlined by the organization’s business strategy. The research of C. H. Robinson Worldwide, Inc. offers a structure for making such connection and for evaluating a company’s competitive position concerning its intellectual properties and abilities. The examination of the company focuses on the importance of innovation in goods transportation with an emphasis placed on the company business’s vision, mission, and values. It also determines a business model for this conveyance. Proposal of a New Service

C. H. Robinson Worldwide is an international contractor in numerous transportation services and logistics solutions all over the world (C. H. Robinson Worldwide Inc. Earnings Conference Call, 2014). The organization has an epicenter of operations in marketing service division, which is explored in this research document. According to C. H. Robinson Worldwide Inc. Earnings Conference Call, 2014, the company moved nearly eleven million consignments and operated with more than forty-two thousand customers. As an intermediary logistics supplier, the company does not own the transportation equipment that is employed in freight transport. In 2014, C. H. Robinson worked with nearly sixty-three thousand freight providers worldwide offering transportation and logistics services like freight carriage, shipping management, taxes brokerage, and storage in warehouses. This business provides logistics resolutions by the truckload, less than a truckload, marine, and air cargo shipping (C. H. Robinson Worldwide Inc. Earnings Conference Call, 2014).

The company’s mission statement remains viable, and it is people, processes, and technologies aim at improving the world’s transportation and supply chains. However, the firm has had periods of struggles to offer excellent value to its customers and contractors (C. H. Robinson Worldwide Inc. Earnings Conference Call, 2014). C. H. Robinson’s core objective is to gain the advantage in the market for the next decade with a fifteen percent development, which implies taking the arithmetic mean of five percent on every method of transportation. These include methods such as air, marine, and domestic consignments for net incomes, returns from maneuvers, and earnings per stake. The mission is based on the people, procedures, and technologies in order to offer exceptional value to the clients and purveyors.

Thompson, Gamble, and Strickland (2012) state that globalization can be precipitated by the blooming of customer demand in several countries. It also involves the actions of government executives in the countries to condense trade barriers that once closed markets to external rivals as it is happening in Brazil. C. H. Robinson plans to exploit the leverage of teamwork to realize the opportunity to export products and services bearing in mind that Brazil has a reasonably free market and well-focused economic stimulus. As a result, this approach can act as a facilitating factor to be proposed for the marketing service division.

The company has been in the logistic business for many years, and advertising has been necessary to its achievement and future productivity (C. H. Robinson Worldwide Inc. Earnings Conference Call, 2014). The firm has established the majority of its operations internally as far as strategic planning is concerned. Its workers use these information systems to ascertain freight matching chances, connect and organize activities with other firms, and find the equipment for other companies’ consignments. These systems also aid consigners to service customer requests, choose the ideal modes of transportation, combine shipments, and select directions all grounded on customer-detailed service limits.

Addressing Customer Needs and Achieving Competitive Advantage

Marketing management forms the foundation for creating a dynamic competitive strategy (Craig, n.d.). The marketing service division position itself as a preferred supplier and uses logistics as a cornerstone of its marketing strategy for growth. In addition to this, it endeavors to understand what customers expect, how well the company’s competitors perform, and how well the division operates. Additionally, the division is on the verge of finding the ways of developing a strong logistics program that meets and even exceeds customer requirements. Reengineering the operation and developing a strong logistics capability is not an overnight fix; it will take some time for the division to realize it gradually. Market and customer needs are always changing, and the division’s ability to change is admirable since it leads the change as an ongoing market leader. It will also have to work constantly to improve services, reduce times and cut costs as its customers need.

Vision and a Business Model

A vision statement demonstrates the company’s strategic determination that concentrates the dynamism and assets of the company on realizing an appropriate prospect. The vision of C. H. Robinson Company is to offer best and timely freight services, tools, and methods (C. H. Robinson Worldwide Inc. Earnings Conference Call, 2014). Like the company’s vision, marketing service division’s vision is to be the number one choice of many organizations and customers to outsource their freight services. It will provide an environment focused on solutions to customer needs that make this accessible in an effort to fulfill the client needs and desires in an easy, comforting, and distinct means. In its value statements, the personnel in the business are the most treasured asset as the division employs the best caregivers and treat them with esteem. As a division, we believe that community and ongoing business activities are critical to the welfare of our customers.

The business will create a significant advantage over competitors gained by granting customers greater value, either through lower prices or by offering superior welfares and services that warrant higher pricing. As a result, it will yield better returns to the company and raise the economic balance.

Guiding Principles and Values

The company keeps its business model as accommodating as possible to consent it to be adaptable and acclimatize to fluctuating economic and industry situations. C. H. Robinson purchases most of the shipping volume and creates “on a spot-market” means. The company also maintains the employees and other working expenditures as adjustable as possible. Payment, the major operating expense, is performance-based and linked to the productivity of the individual commitments for most workers.

Moreover, the firm lacks pre-committed goals for headcount, and the workers’ decisions are reorganized. Location site managers regulate the suitable number of workers from their offices within production rules according to their volume of professionalism. Thus, it helps the organization to keep the employee-related expenses as adjustable as possible in terms serving the company.

As stated by Dess, Lumpkin, and Eisner (2011), the new division can manage ethics in workplaces by establishing an ethics management program. This program is impractical unless all staff members are taught about the regulatory principles and values for a new division within the framework of culture, social concern, and ethics in a global perspective. Hence, all employees must be familiar with and act in full agreement with policies and techniques that require training on policies and procedures.

SWOTT Analysis – Internal and External Environmental Analysis; Supply and Value Chain Analysis

This section discusses the internal and external forces, environmental study, and a supply chain examination for the marketing service division of C.H. Robinson Worldwide Inc. and its business model. It also focuses on the legal and regulatory forces of a marketing service division together with external trends to consider when inaugurating the marketing service division within the company. The internal forces and trends explored include strategy, strategic capabilities, technologies, and intellectual property. On the other hand, the external forces and trends discussed comprise of technological, social, environmental, and competitive analysis.

SWOTT Table

External forces (factors) Strength Weakness Opportunity Threat Trend
Technological Improved global competition Cyber threats, e.g. hacking Exploitation of social media Loss of customers Information-highway
Social Improved beliefs, morals, attitudes, views, and standards of living Very tasking to amalgamate the elements External environment Fear of failure Social technology
Competitive analysis Increases competitive advantage Financial constraints Taking advantage of the rival’s weaknesses Rivals may have numerous strengths Value demand

 

Internal forces (factors) Strength Weakness Opportunity Threat Trend
Strategy Improved productivity Time consuming Influencing goals Objectives may fail to succeed Proper planning
Strategic capabilities Increased competitive advantage Demands confidence Used in both small and large firms Lack of confidence may derail the lead to success Purpose over profit
Intellectual property Safeguard the assets Can be violated easily Requires marginally different rules Copyright infringement Privacy

External Forces and Trends Considerations

Legal and Regulatory

The laws that govern a company may not essentially be similar to those governing a customer-based division (Mann & Roberts, 2014). As a result, it is a prudent hint to work out the exact laws relevant to the marketing service division. Nevertheless, regulations that any corporate firm must consider entail laws about environmental management measures, unbiased competition, online business activities, and marketing promotions. Government regulation is a legal and regulatory issue the company faces. However, it impacts negatively on the company’s development. Even though the primary safety rules is the responsibility of C.H. Robinson Worldwide Inc. Company, carriers face other significant regulations imposed by federal, state, and local authorities. According to the SWOTT analysis, improved beliefs, morals, attitudes, views, and standards of living form the organization’s key corporate social responsibility for better marketing strategies in the division.

Technological

In the contemporary world, the increase in knowledge has presented new technology for virtually every business undertaking. Technological development has rapidly assumed a position of importance in domain competition in international market. In order to compete well in this environment, the marketing service division requires a level of technological development for success (Thompson, Gamble, & Strickland, 2012). The challenge for the division is to invigorate it so it can develop newer products and improve business growth productively and consistently. The division is fully dedicated to delivering perfect results by applying a non-traditional methodology to planning and executing dynamic service and initiatives in modern ever-fluctuating, technology-driven marketing perspective. With several marketing searches beginning from the web, it is necessary to develop with the trends or retard, but the marketing service division is poised to develop technologically.

Social

Social marketing refers to a practice of forming a range of interventions that make a marketing activity appealing to the customers and other target audience rather than relying on just a decision to use communications and promotion. Social factors that influence company are connected with the values of the external environment. Furthermore, “changes in the external environment may serve as important clues or signals…” (Stewart, 2010, p. 60). The division’s social factors include the beliefs, morals, attitudes, views, and standards of living of the people involved in the external environmental culture. They can be utilized to sway the behavior of customers or the behavior of legislators and influential individuals towards policy and environmental fluctuations.

Environmental

External environmental factors include three interconnected subgroups of remote, industry, and operating environments affecting business success. The remote environment includes issues beyond a firm’s operating state like the financial aspect, social, political, technical, and natural influences. The operating environments includes factors that influence a company’s direct competitive state like competitive situation, customer profiles, dealers, financiers, and the labor market demands.

Competitive Analysis

Competitive analysis is essential for the marketing service division in defining the strengths and weaknesses of the rivals within the logistics transportation market. Market positioning gives the division a better opportunity to select the services relevant to the target clients. The division will focus on unique methods and marketing leverage for gaining competitive advantage over other competitors. It plans to use a unique method as a powerful tool in the global market in order to publicize its services and develop word-of-mouth method of promotion through advertising.

Internal Forces and Trends Considerations

Strategy

According to Ghemawat (2002), strategy consists of the actions developed to influence a business’ goals and objectives in determining its success or failure. For an effective strategy, the division must guarantee that all three components are considered. These include being consistent with circumstances within the competitive environment (product, price, accessibility, service, and marketing), engaging realistic necessities of the company’s resources, and careful strategy execution.

Strategic Capabilities

In advance of venturing on refining its marketing service capability, the division’s management team must have confidence in viable consideration. The team must also believe that the development will improve C.H. Robinson’s competitive advantage and, consequently, its result. Pearce and Robinson (2013) discuss the conceptual tools and skills necessary for a successful business in both small and large firms.

Technology

Technology can benefit or impede the development of marketing service division, thus, the C.H. Robinson Company as well. The institution of new technological equipment can build the necessity for revolution within the market. Staff members, in their turn, will have to study how to use the new equipment to execute their assigned duties. Internal forces for technological advancements in organizations advance from numerous sources that may count fluctuations of approaches. They also arise from plans of ethical challenges that occur because of the demeanor of employees, and resolutions that necessitate technology (Dess, Lumpkin, & Eisner, 2011).

Intellectual Property

Intellectual property refers to any immaterial asset that contains human knowledge and views. Most intellectual properties include charters, copyrights, emblems, and computer programs that cannot be acknowledged in the financial books when internally produced. However, marginally different rules apply in the circumstance of computer application software.

Adaptation to Change

In a determination of adjusting to changes in the market, creating a forward-thinking team that includes key functional frontrunners in the company and among customers will help in rethinking startup strategy. Furthermore, the team will formulate business model hypotheses that are grounded on the team’s assessment of market indicators.

Supply Chain

Recommended supply chain approaches for the division include cost-saving stratagem combining marketing service and the supply chain, and reversing logistics as a customer service exercise. Thus, the proposed marketing service division will apply them in the company’s business.

Issues and Opportunities

Regardless of how good the marketing service plan is, nothing good happens when issues affecting customers are not addressed using the best opportunities available. Most customers will judge the company for minor or major service letdowns. Logistics management is a current issue that challenges the company ethically, although its origins lie in military plan. Several organizations use logistics management approaches while not essentially terming it by that appellation. The task of the division considers more than marketing and distribution but also has a role in the management of the entire supply chain. The latter includes everything from the acquisition of raw materials to marketing division’s management. Therefore, logistics is an essential function that allows a company to get its products to the marketplace.

Assumptions, Risk and Change Management Plan; Summary of Strategic Objectives; Balanced Score Card and Its Impact on Stakeholders; the Communication Plan

This chapter of the research paper has two parts including the exploration of the balanced scorecard approach and the intended communication plan establishment. Specifically, it covers the definition of extended customer needs according to the balanced scorecard that can be implemented by the division, private organizations, or incorporation with other companies.

Balanced Scorecard

Areas of Measures Objectives Measure Metrics Target Year 1 Target Year 2 Target Year 3
Financial Improve revenue Cash flow over revenue Profitability (2% (4% (6%
Increase market share Margin (2% (4% (6%
Market Increasing market demand than supply for services Customer retention Customer/Revenue (10% (15% (25%
Market demand Overall demand (3% (9% (16%
Process or Internal Operations Increase services availability to customers Faster way to introduce services Improved time for customer services (8% (13% (20%
Better efficiency with the new division Better overall retention Development of new processes/ improvement of old ones for a new division In about six months NA NA
Learning & Growth Change attitude of customers Customer satisfaction Surveys and questionnaires (85% (90% (95%
Increase customer retention Customer retention bonus Increase retention rate 100% 100% 100%

Strategic Objectives Summary

According to Niven (2006), the companies employing a balanced scorecard strategy have a tendency to outclass the ones without proper methodology of strategic performance management. Additionally, a balanced scorecard supports appropriate strategic planning, better-quality strategy communication and implementation, and sound management information.

Shareholder Value or Financial Value

The financial value examines how the company’s marketing service division should appear to investors so that the business can flourish economically. During the first year, the company is expecting the realization of at least 2% growth, after the second year – 4%, and after the third one it is anticipating 6% growth. The prospects are all logically small although they are goals aimed at achieving stable growth of the investment. In addition to the aforementioned, it is proper to measure the company’s accomplishment over three years of the new division being operational so as to evaluate the overall change.

Market Value

Increasing market demand and supply of services result from better services rendered, and it will make the division to strategize on how to uphold such standards. The overall demand steadily increases over time, making the business prospects to be more predictable in the future.

Internal Operations

The internal business operations view examines what business processes the company should be best at in order to fulfill stockholders and customer needs. This approach evaluates the internal business processes, central competencies, and expertise that would satisfy customer needs. When customers gain access to readily available services, there is an increase in customer services for the benefit of the clientele.

Leaning and Growth

The learning and growth view examines how the company would sustain its capacity to change and advance for the realization of the company’s vision and mission. The learning and growth view categorizes the company’s infrastructure required to back up other perspectives’ aims. Through the change of customer attitude and their satisfaction regarding the services rendered by the company, C. H. Robinson can target a significant improvement index in their loyalty. That is done for assessing learning and growth by clients with the help of administering questionnaires in order to reach at least 95% satisfaction feedbacks.

Communication Plan

With communication regarded as a necessary booster to the balanced scorecard achievement, some companies may find it supportive to establish a communication plan. Communication guarantees that all the information is being conveyed efficiently at all ranks within the company’s administrative networks. Niven summarizes collective objectives, in addition to essential features, for building a communication plan for organizations. When making a communication plan, Niven endorses the “W5” methodology to define the key elements of the plan counting who, why, what, when, and where (Niven, 2006).

Purpose of the Communication Plan

The communication plan’s aim is recapitulating the original objective and vision in order to demonstrate the company’s strategic determination that concentrates the dynamism and assets of the company on the achievement of the proposed goal. The primary audience for the communication plan includes the customers, support assistants within the company’s division, and the entire globe.

Channels of Communication

Consumers’ preferences for customer service channels are rapidly changing, and communication is critical to the success of a business, whether it is communication through emails, phone calls, or daily and weekly meetings. Communication with shareholders is just as necessary so they know what is going on with their shares and if they want to invest even more in the company. The company’s strategic objectives are also an essential element for the success of a new division. Online social sites like Facebook and Tweeter are prevalent in today’s global communication although many firms have not put much effort to exploit such avenues in marketing service surveys. Additionally, the company must appreciate its clients’ communication channel inclinations and be ready for their gradual change. This also implies that companies must select advanced technological systems that give the business agility and elasticity to meet client channel needs presently and in the future (Thompson, Gamble, & Strickland, 2012).

Conclusion

C.H. Robinson Company will obtain valuable information regarding the marketing strategy launched by the marketing service division and familiarize with a great deal of the prospective and potential customers and suppliers. It will leverage all this information to cognize better who is served, their particular needs, and how well the transport network can relate to the customers in the market. It is important to consider innovation in transportation of goods with an emphasis put on a company business’s vision, mission, and values, and if the company ensures that the goals are achieved. Marketing service is a necessary approach to leveraging the company’s competitive advantage. Effective management of the C.H. Robinson Company’s activities relies on sequencing and harmonizing the concerns discussed in this essay. Implementing all these external and internal efforts tactically and wisely will produce and guarantee long-term achievements for the division’s business. Strategies and tactics for implementing and realizing the objectives, measures, and targets must be put in place for the ultimate productivity of the company ventures.

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