Bandar's work

Arabian Island Restaurant "Mataam Jazerat Al-Arab"

2006-05-16T06:58:00.000-07:00

Introduction:

Mataam Jazerat Al-Arab or The Arabian Island Restaurant (AIR), when translated into Arabic, is a traditional Yemenis restaurant. It is located in Almuraqqabat Street near the old market area. The restaurant is not so easily recognizable from the first glance for it is located in a back street in a relatively poor neighbourhood which has a lot of Indians and Pakistanis residents. From the outside, the restaurant has a medium size yellow colour sign displaying the name of the restaurant.
The restaurant is small and packed with a lot of people, and the first thing that hits you when you enter is the noise. Since there are only 15 tables, each one is enough to serve up to six customers; the customers often have to wait up to 15 minutes before they can find a seat. If someone finishes eating and leaves, customers will hurry up to claim the empty seat. Frequently, different customers may have to sit and eat together. Even though they do not know each other they still share the same table. The tables in the restaurant are placed very close to each other which makes it hard to move your chair without bothering the neighbouring person. The consumers are men and there are no women or a family section. Customers are from different nationalities. Most customers are Yemenis, Saudis, and other Gulf nationals. There are pictures of natural landscapes and old villages from many different parts of Yemen on the walls. There are only two washing tubs with shampoo bottles instead of the soup bars or bottles, paper instead of Kleenex and an offer note on the mirror.
Looking at the menu underneath the tables covering glass, the menu is divided into two parts lunch and dinner. Each part has its own dishes; the ten kind of traditional Yemeni food. First dish in the lunch part is called Saltah which is the famous food for the North part of Yemen mainly in Sana’a area and it contains meat, rice, egg, and potato leaves all mixed, stewed and served on clay pot dish. The second dish is Sayyadeiah which is a fried fish cooked with many spices. The third plate is called Mandy and AIR offers two kinds of Mandy chicken and meat. The fourth one is fish Fi Altannor or old traditional oven. The fish is cooked with some spicy spices. The last one is Burma and it is the second famous dish after Saltah. Burma is a meat that stewed in a plat and is cooked (the Marag meat which means the meat soup). All the food is served with Marag and salad and with some sauces.
There are two ways to order at AIR, the first way is telling one of the three waiters, who memorize the orders from the customers without writing the orders. The second way is to shout out your order to the chef inside the kitchen who can somehow distinguish the voice of the costumer in all the noise of the restaurant and handle many orders in the same time. The Yemeni waiter took our orders and in less than ten minutes the order was served.
The prices are very cheap. As a group, we have been there and our orders total was 32 AED. The cashier who is located near the entrance asked us about what we ate and he calculated the total. And, the strange thing with this restaurant is that a customer is not in titled with a bill, but the cashier would ask him for the types of food the customer ordered and charge him on that. In other word, there is a customer trust where the customer is being trusted for paying what ever he eats.

Interview:

We have conducted an interview with 20 people who are customers of Arab Island Restaurant, AIR. We asked six main questions, one of them consists of four parts, and those questions are:
What is your (Age, Nationality, Income (1000-2000, 2001-3000, more than 3000), and Occupation?)
How did you know about this restaurant?
How often do you go there?
What do you like in this restaurant?
How much do you often pay? Is it convincing for you?
What is your favourite meal?
We have only asked six questions because those questions contain the main information that we are looking for and we did not want the customers to get bored while we were asking the questions. The results of the questions are provided in the table of the next page.

Interview results:

Questions# / customers
(1)
25, Saudi, more than 3000 AED, employee
Friends
rarely
See other culture
10-15 AED, very convincing because it is cheap
Saltah
(2)
21, Yamane, (2001-3000), student
Friends
Once every week
Traditional food, reminds him of home
15 AED, very convincing because it is cheap
Saltah
(3)
22, Yamane, (2001-3000), student
Friends
4 times a week
Quality of food
15 AED, very convincing because of delicious food
Saltah
(4)
23, Saudi, more than 3000 AED, employee
Friends
Once every month
Taste food
15-25 AED, very convincing because of cheap comparing to the taste food
Mandee and fishes
(5)
35, Yamane, more than 3000 AED, employee
Friends
At the end of each month
Traditional food
Maximum 40 AED, convincing because it fits the budget and taste food
Haneeth
(6)
23, Yamane, (1000- 2000), student
Friends
Twice a week
Traditional food
8 AED, yes very cheap with taste food
Burma
(7)
28, Emirate, more than 3000, employee
Friends
Once every month
Taste food
20 AED, cheap with taste food
Saltah
(8)
23, Yamane, (2001-3000), student
Friends
Twice a week
Quality of food
9 AED, cheap with taste food
Saltah
(9)
24, Yamane, more than 3000 AED, student
Friends
Every two weeks
Quality of food
10 AED, cheap with taste food
Saltah
(10)
30, Kuwait, more than 3000 AED, Businessman
Friends
Rarely
Delicious food and knowing other cultures
15-20 AED, cheap with taste food
Burma
(11)
25, Saudi, (2001-3000), student
Friends
Twice a week
Price and quality of food
10-20 AED, cheap with taste food
Saltah & Burma
(12)
20, Yamane, (1000- 2000), student
Friends
Once a week
Price and healthy
15 AED, good for having sex
Saltah &Mandee &Burma
(13)
21, Yamane, (1000-2000), student
Father
Twice a week
Quality of food
10 AED, cheap with taste food
Saltah
(14)
38, Qatari, more than 3000, tourist
Friends
Only went once
Quality of food
18 AED, very cheap
Mandee
(15)
33, Yamane, more than 3000, employee
Friends
Every two weeks
Quality of food
18 AED, reasonable
Burma
(16)
21, Yamane, (1000-2000), student
Friends
Every two weeks
Traditional atmosphere
10 AED, cheap with taste food
Saltah
(17)
29, Yamane, more than 3000, employee
Friends
Every Friday
Quality of food
10 AED, cheap with taste food
Saltah
(18)
21, Saudi, (1000-2000), student
Friends
Twice every month
Quality of food
15-20 AED, suitable for student
Burma
(19)
21, Yamane, (100-2000), student
Friends
Usually
Price and Quality of food
Few comparing to food provided
Aqda
(20)
46, Pakistani, (2001-3000), employee
Friends
Every day
Price and Quality of food
7 AED, cheap with taste food
Saltah

Summary of the results are:

Demographic:
All the interviewers are men due to the targeting customers of AIR. We suggested that AIR planned to target the majority of the population of UAE who we supposed are men. And, we believed that the atmosphere of the restaurant is not suitable for families or even for ladies due to the culture of Yemen. In Yemen, men go with their friends to have lunch together and they rarely go with their families, (11th of interviewers).
We found out that most of the customers are young ranging from 20 to 46 years olds and that’s might due to the majority of UAE population. In other word, we have asked five Yamane interviewers whether in Yemen customers are young or not and they all answered that all ages go to restaurants, which supports that the majority of UAE population is young.
Mainly, all customers are from Gulf and especially Yemen, 60% of the interviewers are from Yemen. However, there were some customers from Egypt or Sudan and we have interviewed one customer from Pakistan, but the majority is from Gulf because of the type of food that is provided.
AIR customers’ monthly incomes are varying from 1000 to more than 3000 AED which means all types of customers eat in that restaurant whether they are with limited incomes or with high incomes relatively to the prices of AIR.
Students, employees and even businessmen go to Arab Island Restaurant, meaning that all social classes like the restaurant because of the food provided even thought the restaurant layout and decoration is normal and very simple.

Major influences on the AIR customers:

By looking to the interview findings, we came up with these points:
1)Consumers are influenced by their friends which means they are affected by the utilitarian influence because 19th of the consumers stated that they knew about AIR from their friends which means that AIR has a very brand loyalty because people will not advice their friends to eat in that restaurant unless they are satisfied with that restaurant.
2)Most of the customers eat in AIR more than once in a month. Actually, two customers said that they are addicted to the taste food of AIR. That’s why we asked the interviewers of the main reasons for visiting AIR more than once and 55% of them said because of the quality of food. 15% said the food is part of their culture and they like the traditional atmosphere in AIR.
3)According to the interviewers, the average spending on AIR is 15AED and then we asked them whether that spending is convincing, all of them said “yes” because “it is cheap comparing to the taste food AIR provides”.
4)As mentioned, the two main dishes are Saltah and Burma. Referring to the interview results, 60% of customers prefer Saltah among other dishes and they said it is one of the main reasons of their coming. 30% prefer Burma and the other 10% prefer other type of food.
Overall, it seems to us that AIR does not need to spend on advertising because AIR has already strong brand loyalty and its customers are highly satisfied with the food and services that are provided. Primarily, the main reason of the satisfaction is the cheap price plus the superior quality with that cheap price, (our interview results).

Critical Analysis of findings:

From the results of the interviews that we conducted, we can assume that many consumer behaviour theories apply to the customers of AIR.
*The behavioural learning theories can be applied to the customers of AIR in that the customers probably got a stimuli (in this case they heard that the restaurant is good) and this will result in a response which in this case is visiting the restaurant and trying it out. One approach to learning is through instrumental conditioning in which customers learn to perform behaviours that produce positive outcomes and avoid ones that give negative. This is clearly the case in the customers of AIR since many of them come to the restaurant repeatedly which means that they are enjoying their meals.
*There are two theories that are similar to instrumental conditioning and these are the expectancy theory and the pleasure principle. These theories state that behaviour is pulled by achieving desirable and pleasurable outcomes. This is true for AIR customers since they are getting good quality food, low prices, and tradition atmosphere which are why many of them go to the restaurant.
*Two other theories that can be related to the customers of AIR are theories by Karen Honey and Carl Jung. Karen Honey stated that people are compliant, detached, or aggressive. The customers of AIR can be easily grouped under compliant since a lot of people go there for the atmosphere which is crowded and highly sociably. On the other hand Carl Jung stated that people are shaped by the cumulative experiences of past generations. As stated in the interview results, most of the customers are from the Gulf; this could be because their ancestors ate and lived in such atmosphere which could explain why these customers like the type of food and atmosphere.
*Another important theory is the functional theory of attitudes which explains how attitudes facilitate social behaviour. The customers of AIR might have similar attitudes towards the restaurant (for example liking the restaurant) but for different reasons. Some of these reasons differences could be because of the utilitarian function and the value expressive function. The utilitarian function basically relies on positive and negative effects that the product gives the consumer, if the product (in this case food of the restaurant) is good then the customer will have a good attitude towards the restaurant. The value expressive function states that consumers adopt an attitude toward a product simply because of what consumption of the product says about that person. Many customers of AIR could be going there simply because of what people are going to say if they go there this could include that they like traditional food, they are sociable, and like to encourage local business.
*A theory that can be used to describe the customers of AIR is the Trait theory. This theory states that there are certain characteristics that define a person. For example people could be defined as either introverts or extroverts. The customers of AIR fall under the extroverts because they are socially outgoing and like group orientation, this is true since a quite person will not enjoy his time there because of all the people.

Recommendations:

The only recommendation for the improvement of the restaurant we could think of is that maybe they could consider moving to a bigger location due to the crowdness of the place which could get annoying to the customers.
We recommend that anyone interested in seeing a new food culture to go to AIR. There you can experience all types of Yemeni dishes, and if you are a person that like to socialize AIR is that place for you, since you will meet many people who might just join your table without even asking!

Conclusion:

Arab Island Restaurant is a culturally oriented restaurant with little to offer in the views of those passing by. Without actually stepping foot in the restaurant, it would be quiet difficult to decide whether this is the restaurant for you. However, all people are a collective of tastes. Every person will have a completely different reason to add to the list of why people might approach such a restaurant. It is has clearly shown us that in a similar environment, people can respond differently with respect to which stimuli has driven them to step through the door. Regardless to first impression, the restaurants quality of food is equivalent (for the customers) to a home cooked meal which for most is a very important aspect about the restaurant. Something about the restaurants atmosphere could be considered as to be enforced on the customers; having to sit next a complete stranger or a group of people that you don’t know is actually a key ingredient in serving the home cooked meal. If a customer was to sit alone, they might get distracted by the crowded tables around them. However, if someone was to join in on a table, what would be considered noise in a five star restaurant, will be regarded as the sound of a table full of family members.

Reference:

Solomon, M. Consumer Behaviour. Sixth Edition. Auburn University, (2005).

Motivating Learning and the Development of Human Capital. By: Little, Angela W.. Compare: A Journal of Comparative Education, Dec2003, Vol. 33 Issue 4, p437, 16p; (AN 10917462)

Group member, B, Y, K, S. (2005). Interview. Retrieved from Customers, the Arabian Island Restaurant.

By:
1)Yacoub Al-Shawa
2)Bandar Al-Ghamdi
3)Sohaib Sadaka Sindi
4)Kareem Budair

Planning and AL-Safi Company as an example

2006-05-16T06:36:00.000-07:00

Introduction:

Today most business enterprises engage in planning because it designs the environment to reach the effective performance of working as individual or group. A manager's most important task is to see that everyone in the organization understands the purpose and objective of his/her working. Basically, to be an effective manager, he/she should be aware of what he/she expects to accomplish. According to S. Robbins & D. DeCenzo, planning can be defined as "defining goals, establishing strategy, and developing plans to coordinate activities" (2004, p.7). Moreover, planning can be as bridge that will help us to go from where we are to where we want to be, also we can infrequently predict the future although there is factors beyond our control may interfere in our objectives but with planning we can avoid these factors. Hence, when the organization reaches a new level of it is development, it has to change the way it works; it all depends on the size of the business.
Importance of Planning:
Each business must be planned for at least four reasons. First, planning provides direction to the managers, when the members of an organization understand what the objectives are; the members can begin to do their duties in order to accomplish the objectives. Furthermore, planning reduces the impact of change, and it can clarify the cost of manager's action in response to change. Also, it makes the manager's predict the future and anticipate or avoid changes. Therefore, planning is the tool that manager's need in a disorganized environment. Moreover, planning minimizes waste and redundancy, because everything will be clear for the organization which makes the inefficiency or the weakness points to be visible. As a result, it will be easy to adjust these weaknesses in order to fit the organization desires. Moreover, planning sets the standards to facilitate control which, hopefully, make the members of the organization know exactly what they are attempting to achieve. Planning sets priorities and keep specific things flexible to change with different circumstances and will help the organizations to ensure that thing change as they want to.
Criticism of Formal Planning:
According to S. Robbins & D. DeCenzo, there are some criticisms of formal planning. Some critics argue that planning may create rigidity. They say that planning will make the organization aims to specific goals to accomplish assuming that the environment will not change. Other critics argue that formal planning can not replace intuition and creativity. The strict goals and roles of an organization will prevent the members to be creative. Moreover, they say that planning focuses manager's attention on today's competition, but some big companies found that developing the industry as they go in a dynamic environment is very successful to them. Last topic of criticism is that formal planning reinforces success, which may lead to failure. In other word, if an organization made a success in using a certain plan, this organization may feel confident and decrease its willingness to adapt changing of the environment which may put this organization in different difficulties such as fail to compete in the market.
Response to Critics:
In response to the critics, the authors of management 201 course state that formal planning means high income, high return on assets, and other positive returns. Also, the quality of planning plays a big role in the performance, and for the companies that have not succeed with the formal planning, the cause was the environment. For example, the government regulations reduce the impact of planning on the organization such as pollution. For instance, government allows a specific amount of pollution to each company and the government changes the amount during the year, and this change of law could affect the company's production because the company may have been already planned to produce a certain quantity based on the market demand. Moreover, some critics state that planning makes the organization inflexible and this is not true, because planning includes flexible regulations and objectives that established to be changed with any sudden environmental or economic circumstances. With planning, goals and objectives are clear so all of the organization members know what they are doing and what they are expecting to accomplish. Basically, defining the goals and establishing a strategy can improve the organization in general. For example, planning can be established based on historical information, companies' uses their experience from the previous years to set the production level of their goods and services in order to avoid the shortage from previous years.

Types of Planning:
In general, planning types are categorized whether this type is short term plan or long term plan. Short term planning can be tactical, specific or standing plan. In the other hand, long term planning can be strategic, directional and single use plans, (Management book 201). Now let’s move to the definition of each category and its elements.
Short term plans are usually plan that are implemented in a short period of time which usually one to two years. The most common type of the short term plan is the tactical plan. According to web.syr.edu website, “Tactical planning deals primarily with the implementation phase of the planning process [which] turns strategy [of the organization] into reality [and] usually has a 1-2 year time horizon,” (http://web.syr.edu/). Hence, this type of plan is a standing plan which means the organizations would use it as many as they need.
Under long term planning, strategic planning is a structure for strategic thinking that assists the organization to stay strong, keeps its core competency, avoids weaknesses and takes advantages of any opportunities. The purpose of this type of planning is to make the whole community works together in order to achieve a future goal. The period that this type of plan takes is usually between three to five years, (http://www.planonline.org/). Therefore, directional planning is used when the strategic plan is set up. Directional plan is flexible and can be modified due to the changes that an organization may face and because the directional plan shows the general format of the organization main objective and plan. As mentioned, single use plan fits under the long term plan because organizations set out their strategic plans and they usually use it one time. Briefly, an organization sets out its strategic plan which defines and directs its main objective in the long term period once every three to five years, (Rita Winder, 2003).
As we were searching on the databases and some websites, we found out several new types of plans that we are not familiar with such as operational plan and market plan. Operational plan is simply the plan which deals with daily and weekly activities and its structure is “closely related to organizational structure,” (http://web.syr.edu/). On the other hand, market plan “serve as a management tool to create a system that will help the [organization] analyze, plan and deliver products and services that meet the needs of its various target markets; lead with its strengths; and create an identity that differentiates it from competitors. [Moreover,] marketing planning is a framework for a way of thinking that focuses on creating desired exchanges with target audiences order to obtain for the school its desired outcomes.” Also, market plan is a very short plan which is help between at least three months to a maximum of one year which means it is similar than the tactical plan, (http://www.planonline.org/).
MBO Program:
First MBO stands for Management by Objective. MBO is a system of organized arrangement of the priorities that an organization needs to accomplish in order to be effective in its actions and to achieve its goals, (Thomas J. Peters and Robert W. Waterman, 1982). Another definition of MBO is that it is simply “a system that can facilitate planning and the implementation of plans.” (Stephen P. Bobbins, 1991). MBO was introduced by Dr. Peter Drucker in 1954 in his book, The Practice of Management. During 1960 and 1970, MBO was almost practiced by every management in the USA. Moreover, MBO may be used in small organization or large one, so it does not depend on the size of the organization. Some organizations use the MBO program, but they do not get what they expect to get. That’s, because some organizations set too many objectives which will lead to a very ineffective and efficient of using MBO program. Organization should set at most six objectives to effectively use the MBO program, (Thomas J. Peters and Robert W. Waterman, 1982).
MBO Elements:
There are common elements that most of MBO programs have. Those common elements are specific objective, cohesive participations, deadline and evaluation and feedback of the work obtained. “Objectives should be set for the coming year and then updated and reviewed on a quarterly, monthly, and weekly basis. MBO should be used as a planning tool (what tasks are going to get done), and as a control tool (did people complete assigned tasks),” (Thomas J. Peters and Robert W. Waterman, 1982). In addition, Dr. Thomas and Robert state that the objective must be measurable, attainable and consistence with the company overall goals.
Cohesive work and participations are important in the MBO programs. Employees should participate and involve in the decision making with the manager. Thus, manager will have more opinions and he/she will show that he/she cares about his/her employees. Therefore, works will be more effective and better off.
Deadline must be explicit in order to have an efficient MBO program. Referring to Dr. Thomas and Robert, they say that there is a CEO of one of the largest fortune 500 companies said that “If people are given time to get used to using an MBO system, and use it properly for planning and control (not for rewards or comparative evaluations), the system can serve any size organization well,” (Thomas J. Peters and Robert W. Waterman, 1982).
Finally, after the work is done and all employees did their tasks, the organizations should give their employees feedbacks and evaluations of the works they did. Giving feedback is an important action that managers should do because employees will know whether they achieved what they were expected to achieve or not. Of course, a reward will be given based on the feedbacks. “Rewards are given to individuals on the basis of how close they come to reaching their goals,” (www.1000ventures.com/).
The Strategic Management Process:
Each organization should identify at first its current mission, objectives and strategies in order to ensure that its strategy aligns carefully with its environment. This part of the research paper will focuses primary on both the internal and the external information about issues that might affect the organization’s decision making process. In fact, the main concern for every organization is to identify, collect and translate the external and the internal forces into beneficent plans and decisions which is the main reason behind any success.
One important issue is about environmental scanning in which the internal communication identify, gather, and translate information of external forces into useful plans that might influence the decision making process (Kendra, 2004). There are many trends of external environment that might have a great impact on organization including, social, regulatory, technological, political and economic and industry. For instance, the development of a new technology can affect the organization’s manufacture and production process in the field of time consuming and cost reducing. On the other hand, there are also some disadvantages of environmental scanning related to interpretation of information and overemphasis of scanning.
It is obvious that the strategic management process is the analysis of the external and internal environment that helps the decision making to create strategies that seek to fulfil the established goals. According to Jeffery Harrison and Caron St.John, there is no unchanged or permanent model of strategic management process; however, any model should present almost the main consequences that many organizations follow (Harrison & St.John, 2004).
External and Internal Analysis
Strategic Direction
Strategy Formulation
Strategy Implementation and Control
Strategic Restructuring Note: This Diagram has been taken from the book (Foundations in Strategic Management), see the reference.

External and Internal Environment Analysis:
The environment analysis includes both the broad environment and the task environment which help the management or the decision making to recognize the basics of the strategic direction beside the organization threats and opportunities (Harrison & St.John, 2004). First, the broad environment can be classified into two main forces, domestic and global environment. The most important forces are socio-culture, technology, political and economic dimensions. Second, the task environment includes external and internal stakeholders. As the authors define them, the external stakeholders are groups or individuals who are outside the organization and have an obvious effect on the organization such as, customers, suppliers, competitors and government sectors. Thus, it is important to analyze these external stakeholders in both domestic and global level and within the cultural, technological, political and economic trend.
Internal stakeholders are very important because it has a great impact on the organization’s outcomes (Harrison & St.John, 2004). These internal stakeholders include mangers, employees and the owners; moreover, it should consist of the organization resources and capabilities in order to full determine the organization’s threats, weaknesses, and opportunities for development (Harrison & St.John, 2004). As a result, the analysis of both the external and internal stakeholders are involved in the SWOT analysis, including strengths, weaknesses, opportunities and threats.
Strategic Direction:
Strategic Direction is related to the long-term goals and objectives of the firm and it is very important because it works as a guideline to follow by managers and employees (Harrison & St.John, 2004). In addition, it helps them to fully understand the relationships between the firm and its external stakeholders. In other words, strategic direction answers the question of why the firm exists and determines the purpose behind the organization operation. In addition, strategic direction is permanent in comparing to the short-term strategies.
Business and Corporate Strategy Formulation:
Throughout the course and from out text book, we can define a strategy as a plan that tend to convey the organization toward its short term objectives and deeply to the basics of its purposes (Harrison & St.John, 2004). According to Jeffery Harrison and Caron St.John, the strategy formulation can be classified into three main categories including, corporate, business and functional formulations and one possible way to differentiate them is to determine the organization level and decision plan. For instance, corporate strategy formulation is very important for the high level organization. First, business strategy formulation relates to the areas in which businesses struggle. Second, corporate strategy formulation relates to the areas in which the organization compete and these areas are different based on the organization purposes and goals. Third, functional strategy formulation relates to the ways the functional areas such as marketing, operation and finance implement.
Strategy Implementation and Control:
Strategy Implementation refers to establishing the systems, structures and processes that help the organization to fulfill its fundamental strategic goals (Harrison & St.John, 2004). Systems are very important to train the employees, support the organizational standards, develop the planning efforts, and improve the information flows including, the process of gathering, analyzing and transforming. Structures refer on how people work and their comprehensiveness with other teams and departments. Processes are very important to create consistency and improve the efficiency throughout the organization.
Strategic control reflects the adjustments needed in strategic direction, implementation and plans because each factor of the strategy implementation may require change as the organizational trend fluctuate over the time (Harrison & St.John, 2004).
Strategic Restructuring:
Restructuring is related to the issue of renewed the successful strategies of the organization throughout different techniques in order to refresh the organization strengths (Harrison & St.John, 2004). According to the authors, the most relevant methods of restructuring include, refocusing corporate assets on more efficient way, reducing the expenditure and reorganizing the organizational structures.

The steps of the Strategic Management Process:
The management needs to evaluate the environment of its company or organization. In fact, we can define the steps of the strategic management process in SWOT analysis including Strengths, Weaknesses, Opportunities, and Threats in order to evaluate the organization internal strengths and weaknesses, as well as recognize any external opportunities (positive factors) or threats (negative factors) (Collect, 1999). Strengths refer to what company does well and its strongest areas in the market. In addition, they measure its clearness of strategy and environment. Weaknesses reflect the poor areas in the company and the ways needed to improve them. Opportunities relate to the new technology and market that are valuable to the organization. Moreover, they present the trends that might very useful and beneficent for the organization. Threats include the competition and other difficulties that might affect the organization negatively such as new technology that might threat the production process. SWOT analysis is very important because it provides information and assigns probabilities in both positive and negative terms as basis for developing the organization’s plan ns strategy. Thus, SWOT analysis will help management to identify and maintain the organization’s strengths. In addition, it is very beneficent for management because it helps them to identify ways to prevent or at least reduce the weaknesses and also to face the threats against the company. Moreover, it will establish a future plan to achieve success and development in the organization. In the last part of our paper, we are going to experience the SWOT analysis on Al-Safi Danone organization.

Background of Al-Safi:
Al-Safi Danone is a dairy company that operates in Saudi Arabia and the GCC countries. UAE is the second main market after Saudi Arabia. Their market share is over 30% of the Saudi and Gulf market. They are considered the second largest dairy company in the region, and they own and operates the largest integrated dairy in the world. Their farm was in the Guinness Book of Records since 1996. As of now they have more than 33000 caws of which 16000 are milking caws. The company employs more than 35000 people in its farming, marketing and distribution operations. The company is a joint venture between HRH prince Abdullah AL-Faisal son of the late king Faisal and the French company Group Danone. The company has a wide range of products that includes Milk, Laban, Yogurt and many other value added products. The company has a distribution fleet of over 500 trucks, and around 30 distribution centres around the kingdom and the gulf.
The company has an aggressive plan to increase its market share and to be the number one dairy company in the GCC. Their strategies can be:

Maximize the distribution system:
Al-Safi maximizes its distribution systems by reaching other or new areas and utilizes the distribution system better. It includes the incensement of the market share in A stores. According to Mr. Mohammed Al-Shonaify, the general manager of Al-Safi Dairy Company, (A) Stores are the big supermarkets. As of now the product are sold through B and C stores which are the small supermarkets. Al-Safi is doing its best to make its products showed everywhere such as A stores. The reason behind this is that Al-Hajj and Ramadan seasons are very profitable seasons because many pilgrims come from different countries such as Iran and Syria and their demand of dairy usually increase due to their culture belief, (Mr. Mohammed Al-Shonaify, 2005)

Build Operational Excellence:
Build operational excellence by improving the efficiency of the lines, reduce the losses of Milk, improve the quality of production, improve working capital and stop Milk Re-crashing, Mr. Mohammed Al-Shonaify, 2005)

Improve qualification of the organization:
Al-Safi has been improving qualification of the organization by hiring or employing qualified stuff and by giving employees training programs to improve their skills in all departments. In addition, improve working / living conditions by improving the working environment and the facilities where people work, (Mr. Mohammed Al-Shonaify, 2005)

SWOT Analysis:
Based on the study conducted on Al-Safi dairy planning and the different elements that influence it, an analysis of the company’s strengths, weaknesses, opportunities and threats can be formed.
Strength:
A very large company and a market leader
The company has invested heavily in the business. New entrant will require big investment to inter the market (barrier to entry).
Big distribution fleet of over 500 refrigerated trucks ( strong reach), (Mr. Mohammed Al-Shonaify, 2005).
A well recognized brand, a wide portfolio of products combined with excellent quality products.
Vast experience in the market (good know how)
A big market share of over 30%, (Mr. Mohammed Al-Shonaify, 2005)
Excellent new products development capability (value added products).
Strongly believe in advertising and spend heavily on product development and advertising.
Controls its supply of raw milk by having its own farm.
Weaknesses:
Deal with commodity products. Value added products are still small percentage 0f sales.
Heavily dependent on direct sales by sales men (no pre-ordering), (Mr. Mohammed Al-Shonaify, 2005).
Limited supply of raw milk which effect expansion.
Opportunities:
High percentage of youth. Over 60% of population is under the age of 20 which makes the market good for new value added products.
Dairy companies in Saudi Arabia are by far the leaders in the region. Region expansion is a great opportunity.
Milk consumption per capita in GCC countries is very low compare to other countries in the world. An opportunity to increase dairy products consumption among population is another opportunity, (Mr. Mohammed Al-Shonaify, 2005).
Threats:
Price wars will effect an already small margin
Increase in feed commodity prices will also affect profitability.
Out break of any diseases in milking caws will effect production of raw milk.
Threats from soft drinks. Youth are into drinking soft drinks more than milk.

References

Stephen P. Robbins & David A. Decenzo. (2004). Fundamentals of Management. Fourth edition. New Jersey.

http://web.syr.edu/

http://www.planonline.org/

Rita Winder. Futurics. St. Paul: 2003.Vol.27, Iss. 1/2; pg. 30, from Proquest database.

Thomas J. Peters and Robert W. Waterman, Jr. 1982. In Search of Excellence. New York: Harper & Row. p.154, from Proquest database.

Stephen P. Bobbins (1991), Organizational Behavior. Englewood, NJ: Prentice-Hall, from Lexus Nexus database.

http://www.1000ventures.com/

Collect, S. (1999). SWOT analysis. Computerworld, 33(29), 58. Retrived April 20, 2005, from the EBSCOhost database.

Harrison, J & St.John, C. (2004). Foundation in Strategic Management. Third edition.
Thomson, South-Western.

Kendra, A. (2004). Environmental Scanning: RADAR for Success. Information Management Process, 38(3), 38. Retrieved April 20, 2005, from the
EBSCOhost database.
An Interview with Mr. Mohammed Al-Shonaify, the general manager of Al-Safi Dairy Company. The interview was taken during the spring break by Moath Al- Shonaify on 20th of April 2005.

By: 1) Bandar Al-Ghamdi
2) Osama Ali Isa
3) Moath Al-Shonaaify
4) Mohammed Al-Naimi

EMAAR’s Development of a New Property Project in Tunisia

2006-04-16T10:00:00.000-07:00

According to:
http://www.gulfnews.com/business/Real_Estate_Property/10033418.html,

The article states that EMAAR, the world’s largest real estate company by market capitalization which is located in Dubai, is developing a new property project in Tunisia with an amount of $1.8 billion. “The 442-hectare Marina development is located in the county of Sousse towards the southern end of the Golfe de Hammamet and will offer a mix of living options and tourist attractions with a large Marina Village at its centre”.

Well, I think Hamel’s framework is suitable to analyze such an article like this one since it analyzes the business model of the company that takes a certain project aiming to achieve a certain goal in the future. So, I am going to analyze it according to Hamel’s points of views to see whether EMAAR overall performance will be enhanced by engaging in such a costly project like this. Referring to Hamel’s point of view,

Core Strategy:

1. The Business Mission: EMAAR is the largest real state company in the world in term of market capitalization and according to its website, http://www.emaar.com/, it is planning to expand and increase its market shares and market capitalization by expanding in any parts of the world if that will add value.
2. Product/Market Scope: According to EMAAR’s website, EMAAR is running its business in many Arab countries such as Saudi Arabia, Syria, Morocco…ect and some international countries such as Malaysia. So, by entering Tunisia EMAAR is adding this country to its Arab portfolio countries which of course will increase the market capitalization of EMAAR which is its primary objective.
3. Basis for Differentiation: EMAAR is differentiating its self among its competitors by delivering a very high qualified and luxuries touches to the property it works on. For example, EMAAR has a joint venture with Armani to design one of the hotels that EMAAR runs in Dubai, Burj Al-Arab.

Strategic Resources:

1. Core competencies: As mentioned, EMAAR core competence it in the real state fields, and now, with a deal with the Tunisia president, EMAAR is offering its service knowing that there is no real state company in the world that is able to serve its customers the way EMAAR does. I believe EMAAR is one of the best of not the best that builds up 7 stars hotels such as Burj Al-Arab and that’s why this is its core competence which is being unique in term of offering luxuries properties.
2. Strategic Assets: EMAAR will add value to its overall assets they own in different parts of the world. Hamel has mentioned that those “strategic assets should be rare and valuable” for the firm to enhance its overall performance. I think EMAAR is doing so since few real state companies in the world that have strategic assets distributed all over the world; and, EMAAR has this advantage since its has run its business in many countries and own assets there. So, EMAAR is going to enhance its strategic assets in the Arab countries since it will run those properties in Tunisia which definitely will be rare and valuable that rarely a company may achieve.
3. Core Process: Hamel has mentioned in his framework that the “core process” is the basis of innovation that a company might have. This core process is what the people inside the company do. Relate that to EMAAR article, I really agree that core process is the basis of innovation since EMAAR employees know exactly with the customers are looking for and the ranking of the customers by their social statues. In other word, EMAAR is offering very luxuries hotels and villas, average luxuries and normal hotels and villas. That’s why, I think, EMAAR is innovative since the people in the company know the market demand and that’s why EMAAR went to Tunisia market. According to Al-Abbar, the CEO of EMAAR, “Tunisia is a country rich in heritage and we look forward to the opportunity of adding to its world class attractions with the development of Marina Al Quasar. This project is a timely addition to Tunisia's thriving tourism industry which has been attracting the world's attention”.

Customer Interface:

1. Information & Insight: I think EMAAR is acting in a proactive manner since it takes the opportunity of entering the Tunisia market. And, it has offered the customers that are hoped to buy the properties with the information of the properties and it was stated in the article that the properties including hotels and villas are ranked from 4 stars to 5 stars to very luxuries properties.

Wealth Potential:

1. Unique: I think EMAAR is really aware of that since customer precipitation is the key player here. I mean EMAAR will have many customers who are willing to buy properties, especially tourists who are the primary target of this project, since EMAAR is considered unique in the way it provides its services.
2. Profit Boosters: I think EMAAR is aiming to “lock-out the competitors” since it is the first company that engages in such a business like this in Tunisia which again will increase of expected profits for this business to EMAAR.

Overall, I strongly believe that EMAAR will be able to achieve its goal which is increasing the market capitalization by running this business since as I mentioned from my analysis, the overall performance of EMAAR is going to be enhanced from this new move that EMAAR has done so far.

Switzerland Largest Bank Expansion in USA

2006-04-11T12:39:00.001-07:00

According to:
http://www.swissinfo.org/eng/business/detail/UBS_angles_more_wealthy_American_clients.html?siteSect=161&sid=6622409&cKey=1144755189000,

The article states that UBS, Switzerland largest bank, is on the process of acquiring private client network of Piper Jaffray Companies “PJC” which will cost UBS around $500 millions. Therefore, UBS total assets will increase to reach $52 billions with this new project.

Simply, the company that UBS is acquiring is a financial company that “has more than 800 financial advisors and serves about 190,000 households, provides wealth management services to private clients include estate planning, retirement planning, brokerage and insurance”.

Well, I think analysing this article according to Hamel’s framework is the best suitable one.

According to Hamel:

Core Strategy:
1. The Business Mission: UBS is planning to grow more in terms of financial fields in the US, therefore, for a US investor, it will be better and more trustful for him/her to invest in a company with UBS experiences and supervisions knowing that UBS is the largest bank in Switzerland and it manages more than $370 billions for wealthy clients.
2. Product/Market Scope: UBS is already in US, but this new acquisition will enhance UBS position in USA since it will cover more regions in US since PJC has 90 branches that cover 17 US states. So, this new acquisition will make UBS able to target more clients and provide them with convenient services.
3. Basis for Differentiation: I think UBS will differentiate its business among existing competitors such as Credit Suisse since it is going to cover more regions in such a large country in term of financial services like US.

Strategic Resources:
1. Core competencies: here, UBS is competing in a very competitive industry which is Financial Service Firms, but its core competence is to provide the best service since it has thousands of highly specialized financial analysts and advisors since UBS runs an enormous amount which is as stated earlier $370 billions for wealthy clients.
2. Core process: As mentioned, UBS has very highly specialized financial advisors who will run clients’ wealth in the best possible and profitable ways.

Customer Interface:
1. Information & Insight: I think UBS will improve its position since it will serve Swiss customers with better way and give them the latest information in one of the most important country, USA, in term of financial services since its position in the US market becomes better with this new acquisition.

Overall, I think UBS did a smart move since it has strengthen its business in USA by acquiring one of the most important Financial Service Companies and that’s really a proactive action that UBS is hitting hoping to take advantages of any possible opportunities in the future.

Volvo's new step!!

2006-03-22T08:49:00.000-08:00

According to:
http://news.bbc.co.uk/2/hi/business/4827790.stm,

The article states that Volvo is buying 13% of Nissan Trucks shares aiming to increase its profits and gaining accesses to the sale channels of Nissan in China.

Well, I believe the main aim of Volvo is taking the opportunity of what the Chinese market is promising, knowing that China is booming these days in terms of business activities.

I think Barney’s framework can be used in analyzing this article since Volvo is already in the automobile market, and this new step will be tested in this analysis in term of whether this new step will add a significant value to Volvo or not.

So, let’s ask the important questions that will answer the main question which is “will this new step add value to the overall importance of Volvo performance or not”.
The questions are:

1. Question of Value: Barney said that in order for a firm to have a competitive advantage, it should have resources and capabilities that will lead for adding a value to this firm. Thus, I believe that owning 13% of Nissan shares will ease it for Volvo to get access to China and Japan Markets, noting that Nissan has an alliance with a Chinese car companies, which therefore will increase the performance of Volvo by increasing sales and market shares in those two big countries and yes in the end will definitely add value to Volvo company.
2. Question of Rareness: the point here is the concern of competitor resources and I think this new step will make Volvo a kind of rare among its competitors especially among international manufacturing such as Ford and Mercedes which are large truck manufactures. I mean that, as far as I know, non of the car companies have done that, but they have their own channels in those markets which may give the opportunity to Volvo in not costs for establishing them.
3. Question of Imitability: I think it is difficult for Volvo competitors to do what Volvo has done, but it is quite possible if they make sure to gain advantage of buying local company shares. It is difficult since the cost is kind of high, almost $200 million of owing 13% in Nissan truck sector, but as I said it is quite possible since Volvo competitors have large amount of cash flows such as Ford and Mercedes. Hence, Volvo might not take the full advantage of that which I will discuss more later on.
4. Question to Volvo: Barney asked this question “Is a firm organized to face the full competitive potential of its resources and capabilities?” and in this case I can not be sure to answer this question but if I pretend to be the CEO of Volvo company I would answer with Yes since the CEO would not do something, in general, with no studies and right analysis. And, I think Volvo can make it and is willing to take the opportunity and face any threats due to its name and well-know of the automobile industry.

After answering those four important questions, I think Volvo will have a temporary competitive advantage since this resource is not highly difficult for competitors to imitate which made me to recommend Volvo to acquire a new technique that will make it valuable, rare and difficult to imitate; or I think Volvo can get the “first shot” which is increasing the market shares as much as it can to make it difficult for competitors to imitate its new step and success with it.

TOYOTA expansion in Europe

2006-03-16T02:43:00.000-08:00

According to:
http://news.bbc.co.uk/2/hi/business/4241138.stm,

The article started with the new generation of TOYOTA cars that are planned to be launched in the Europe markets.

TOYOTA is aiming to increase the productions of its factory where it is located in France, and that’s dude to the highly expected demands that TOYOTA has estimated.

Well, since TOYOTA is already in the market, I think Porter’s five forces are the most suitable for this analysis.

According to Porter, a business may face five forces when this business is in the market and competing in the industry. Yet, I will only use three forces that I think are most important for this particular case. TOYOTA is competing in Europe in a very competitive environment where many large companies are seeking for more market shares to penetrate the automobiles markets.

The three forces that TOYOTA is facing are:

1. Potential Entrants: Now, TOYOTA is increasing the production, I think, either to cover up the cost, meet the demands or to gain more market shares. One of the most important issues that should be concerned when launching a new product in the same industry, in this case, is the cost, access to distribution channels and product differential. Cost, TOYOTA has decreased the cost since it increased its productions even though it operates in France where labour costs are higher than TOYOTA competitors such as Germany cars where they operate in Eastern Europe or Asia. Access to Distribution Channels, TOYOTA has already established those channels and it spends more in advertisements to increase the brand awareness of this new car. Product Differential, Porter believes that a product will not be differentiated among other competitor products unless it comes out from a new industry; however, TOYOTA is trying to be different than its competitors especially in launching this new car due to the low price and the high durability that this car is offering.
2. Rivalry among Existing Companies: I believe automobile market is one of the most competitive markets everywhere in the world. So, TOYOTA is facing this challenge especially in such a place like Europe where most of the automobile manufactures are; thus, TOYOTA has overcame of this challenge when it spent more in advertisements which result to high demands and the increased the production. Also, the sales of TOYOTA in Europe have increased by 4% which resulted an increase in the market share to be 5.4% comparing to pervious year. Now, I think, this incensement of the market shares is convincing fro TOYOTA knowing that more than 20 large companies are competing in the same industry.
3. Bargaining Power of Buyers: in the article, nothing was mentioned about the customers in Europe, but obviously, buyers play a huge role for TOYOTA since they have different verities of cars to choose. TOYOTA has made it difficult for competitors when it made its customers loyal, and satisfied them by increasing the quality of the new car as mentioned in the article.

Overall, I strongly believe that TOYOTA is a company that is very difficult to compete with since it always launch products that are different than other competitors either in the quality, price or the overall performance of its products. So, it is not unusual to hear that TOYOTA market shares have increased in any places in the world or that TOYOTA is launching a new product to compete among any kinds of competitors.

Should Dubai Port run its businesses in USA ports?

2006-03-08T10:31:00.000-08:00

According to:
http://www.easternecho.com/cgi-bin/story.cgi?31228

The article states when of the writers’ own opinion of what is happening nowadays in the USA.
As known, Dubai Port has asked to run its business in different ports in the USA ports but Dubai Port is facing disagreement with some democratic representatives since Dubai was indirectly responsible for the attack of 11 September.

Well, I think this is really a serious issue that Dubai is facing now. By looking to Baron’s framework, he says that some of the non-market matters may occur and prevent a certain business to run its activities.

There is some arguments that whether businesses and politics should be related or not and by looking to this issue, we realized that businesses and politics are really related. And, that’s because people and government still relate and blame Dubai to what happened in 11 of September even though Dubai is in the alliance of fighting the terrorism.

Therefore, that enhances the analysis of Baron’s framework which shows that the four I’s are appeared here which are:
1)Issues: the issue of fighting terrorism and unfortunately linking Muslim and Arab countries to terrorists.
2)Interest: and of course Dubai Port has economic interests on running its business over there and American people have the interest on those ports since it is their own country and they have the right to be safe.
3)Institutions: there is some institutions that agree with the democratic sector who refuse at all of allowing Dubai Port to enter to the American ports.
4)Information: here I strongly believe that American people and democratic sector should realize that what certain people did badly and even though they belong to a certain country, this county should not be held totally responsible to their actions.

I think that this issue is in its 4th stage where administrative negotiations are taking place. Though, the last three stages, according to Baron, are already passes where the issue identification, interest group formation and legislation took place.

Overall, that reminds us of Porter’s five forces and specifically the first one which is the potential entrants since Dubai Port wants to expand its business by entering American ports, but Dubai Port is waiting for the government, who plays the big role here, to accept Dubai Port proposition and allowing it to run those ports.

I strongly think that USA should allow Dubai Port since it proved its success in running ports all over the world and Dubai alliance with USA in fighting terrorism.

Comments on "Selfishness Has Its Value to the Economy"

2006-02-14T21:12:00.000-08:00

According to:
http://www.realclearpolitics.com/Commentary/com-2_13_06_PAB.html,

The article begins with describing the situation that Wal-Mart is facing in New York for its new plan to open up branches in New York.

Wal-Mart is one of largest retailers in the world and it is a multinational business which operates in different countries such as China, Hong Kong….ect.
It has many branches in USA and now it is planning to expand its market shares by operating and running more stores in New York. It faces resistances from New Yorkers since New Yorkers consider Wal-Mart as a selfish business which is an only profit-oriented business that does not pay attentions to society members.

Well, I think every business should be a social responsible business, but that does not mean the business can not seek for its own benefits and expand its activities. I believe that Wal-Mart is one of the best retailers since it provides customers the best prices that the customers may find. And, talking about selfishness, American people are considered to be a high individualism society which implies that individualisms usually seek for the cheapest price they may find no matter where they would find it.

I think if Wal-Mart operates in New York, which will give the opportunity to consumers to have a barging power on the prices since New York has a very competitive market. Furthermore, Wal-Mart will try its best to market its products in a convince way to satisfy consumers such as offering them the best price and the best service.

One may argue that Wal-Mart might take advantage of its retailing power and try to beat the market which may have an effect on the consumers, but I believe this is not true since competition is open for any firms to enter the market. Not only that, but USA is a highly developed country and if we assume that Wal-Mart may do so, Wal-Mart may be sued for Anti-Trust as what happened to Microsoft when it tried to take advantage of its power in marketing its operating system program to sell other software.

Looking deeply in Wal-Mart business and analysing it according to Barney’s frame work, Wal-Mart’s activities are not rare and also the quality of its service is not something that can not be imitated, therefore; competitors may develop their services and businesses to compete with Wal-Mart.

Finally, I always believe that rejecting something must have a reason behind it, and resisting Wal-Mart to operate is not beneficiary to the consumers since as stated earlier Wal-Mart will make other retailers to compete as mush as they can which in the end, consumers will be benefited.

Comment on "Effect of Danish Boycott Patchy"

2006-02-06T09:32:00.000-08:00

According to:
http://www.arabnews.com/?page=1§ion=0&article=77011,

the article began explaining what happened nowadays with Danish products. One of the largest daily newspapers in Denmark has depicted Prophet Mohammed (Pease be upon him) in a very offensive way. That was the main cause of Muslims to ask for boycotting Danish products and asking Danish government to apologize. However, Danish government refused to apologize by saying that “they have the right of saying their opinions”.

As in the article, most of the retailers in Saudi Arabia, (Saudi was mentioned as an example), generate 5% of their sales form Danish products. And, one of the well-known companies in Saudi, SADAFCO, was accused because SADAFCO used to have a joint venture with Danish company and Saudi people still believed that SADAFCO still has this relationship.

People in Saudi started boycotting Danish products and moving for other substitutable products. That leads to a really big dilemma because Saudi retailers were forced to call up their products and suffered some loses.

I believe that everyone has the right to say his/her opinion, but should be aware of not offending other’s feelings and beliefs. Saudi Arabia is the largest Gulf market and one of the largest markets in the Middle East. So, losing a relationship with Saudi retailers means that giving up a huge percentage of the market shares in Middle East. Danish products are mostly consumption products which imply that the customers play a big role in generating revenues. What happened recently has destroyed the relationship that some Saudi retailers used to have with either their suppliers or customers, since retailers were forced to stop launching Danish products and; therefore, they lost their relationships with suppliers. I believe that Danish used to have a competitive advantage in its milk products that used to be sold in Saudi. Now, Danish lost this core competencies and gave its competitors the opportunity to make the customers choose their products especially if those competitors are local. In other word, I think Danish was not acting in a pro-active way when the newspapers published those offensive cartoons.

Yes, some may argue that publishing cartoons in the newspapers was not the Danish companies’ mistakes, but as known that businesses usually have strong influences on government or newspapers since they pay taxes to the government and use the newspapers to advertise their activities. As a result, I think businesses would be able to stop that publishing or at least force the government to apologize.

Comment on "The Real Cost of Google's Sellout to China"

2006-01-31T08:36:00.000-08:00

According to http://www.editorandpublisher.com/eandp/columns/shoptalk_display.jsp?vnu_content_id=1001918977,

Google is trying to enter the Chinese market by pleasing the Chinese government and working in favour with what the regulations are in the biggest communist country in the world.

Google has refused the US proposal which was asking Google to hide some websites which contain sexual incentives that are inappropriate for children. However, Google refused this proposal by arguing that freedom shouldn’t be restricted. On the other hand, when Chinese government asked Google to hide some websites for political reasons, Google agreed without any intention to argue against that.

I agree with what Google has done so far, since Google is a business organization which aims, in general, to increase its value. So, USA is different than China such as the political and governmental rules and regulations. In other word, Google has entered China internet market for expanding its business and taking advantage of the second biggest internet users in the world. Therefore, one of the main barriers that a business firm face is government regulations. And, if Google did not agree with what Chinese government asked, Google would lose the opportunity of doing a business in such an attractive country like China.

Yes, some people argued that business firms should act same no matter where their businesses are taken. But, as mentioned, the goal of any business is to increase the value of its firm. Governments are different around the world, so I strongly believe that no one can run his/her business in a democratic country and communist country in the same approaches. So, I believe Google should not be abused for allowing Chinese government to interfere in Google business because China’s regulations are difficult and are not flexible as in US and that’s because China isn’t a democratic country.

testpost fo managment406

2006-01-22T02:27:00.000-08:00

testpost for managment 406 at AUS