Cuthbert - Business Analysis Project

7/31/2019 Cuthbert - Business Analysis Project

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CUTHBERT

CHINJI JNR

207014329

2010 ©

A COMPREHENSIVE CASE STUDY

FOR

ZENGANI BUILDING PROJECTS

(22nd

April 2010)

INTEGRATING

BUSINESS PROCESSES AND ACTIVITIES

PREPARED BY

CUTHBERT CHINJI JNR

207014329

FOR

MRS F. MPOSULA

(BUSINESS ANALYSIS)

Zengani Building Projects

Giving Solutions & Quality to Buildings

73 Bridgetown

Agulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.za

CUTHBERT

CHINJI JNR

207014329

2010 ©



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Table of Contents

Page

1. Background...........................................................................................3

2. Vision.....................................................................................................3

3. Mission ..................................................................................................3

4. Firm Analysis........................................................................................3

5. Types of organisational Activities.......................................................3

6. Life stages of the company..................................................................4

7. Porter five forces..................................................................................5

8. Swot analysis........................................................................................5

9. Factors that cause a firm to decline....................................................6

10. Successful organisations......................................................................7

11. Analytical process................................................................................7

12. Strategic choices at the top level........................................................8

13. The resource based perspective.........................................................9

14. Strategic Position and Action Evaluation (SPACE)........................9

15. References...........................................................................................10

CUTHBERT

CHINJI JNR

207014329

2010 ©



73 Bridgetown

Agulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.za



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1. BACKGROUND

Zengani Building Projects (ZBP) is a small privately BEE owned company that

was conceived in July 2008. It is one of the few companies that has managed to

withstand the harsh realities of global economic recession which has forced many

small businesses out of the business. As the name suggests, we specialise in

waterproofing projects.

2. VISION

We aim to be one of leading construction companies around Gauteng in terms of

service delivery while empowering the society at hand through job creation.

3. MISSION

Our mission is to provide the best services to our clients at competitive prices

without exhausting the cash flow of our company.

4. FIRM ANALYSIS

In our case study, we have used Firm Analysis to evaluate and identify strategic

options available that we will implement to enhance and streamline our business

activities.

We identified that our clients need waterproofing related services such as building,

painting, renovations and plastering which are not currently supplied. We have

decided to offer such activities not currently supplied. This fits in our current

activities since we are already dealing with close related activities. This will not

only, satisfy our clients’ needs but also enable us to generate more revenue for

company growth.

Offering this new service will have a positive impact not only in terms of our cash

inflow but as well as increasing our market share since we will be offering a wide

range of services.

The company does not have enough operating capital to fund acquisitions of raw

materials as well as extra labour skills, and that poses a major challenge for us to

extend our services to clients. Having already projected a positive cash inflow as a

result of extending our services, we will raise funds through bank loans at

affordable rates.Offering of our new services to our clients is seen as growthCUTHBERT

CHINJI JNR

207014329

2010 ©



73 Bridgetown

Agulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.za

CUTHBERT

CHINJI JNR

207014329

2010 ©



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Manager

Salesperson Supervisor Accountant

General Workers General WorkersAgents Book Keeper

within our company which will need to be managed. Unfortunately our top

management is not well equipped with leadership skills due to previously held

positions. In the best interest of our staff members as well as for sake of the

company growth, our top management will constantly go on monthly basis for

workshops to acquire leadership and managerial skills.

5. TYPES OF ORGANSATIONAL ACTIVITIES

Innovation activities: We are predominantly charged with Sales and Marketing,

Product research and development. We are doing this through local newspapers,

sales agents, text messaging technology as well as through our newly launchedweb site. This has enabled us to reach new customers that are geographically

dispersed.

6. LIFE STAGES OF A COMPANY

Direction: Our Company’s power still resides in the hands of the top management

which are also the co-founder of the business. They take charge of the direction of

the company. Functional tasks such as production, distribution and marketing are

the responsibility of supervisors. The functional organisation structure of our

organisational structure can best be depicted with the following histogram.

Figure 1. Functional Organisational Structure of Zengani Building Projects.

CUTHBERT

CHINJI JNR

207014329

2010 ©



73 Bridgetown

Agulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.za



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7. PORTER’S FIVE FORCES

i. The threat of new substitute Products:

ZBP being a newly formed company has not fully gained a market share for its

services. We therefore face threats from competitors that have been in the business

industry for decades with similar products and services. This is true especially

when customers do not incur switching costs between providers.

ii. The threat of new entrants:

The rate of South African young entrepreneurs is growing in the constructionindustry. This brings another threat to Zengani Building Projects as many young

entrepreneur enthusiasts are entering the construction industry with similar

services and product features.

iii. The power of buyers:

When buyers have information about the costs of production, they can negotiate

prices down and reduce our industry profitability. To avoid this, we will insure that

price acquisitions and costs of our resources are kept as confidential as possible.

iv. The power of suppliers:

This is high when there no substitutes for the supplied products. As a result of this,

such products can command high prices.

v. Rivalry among industry members:

Competition tends to be high when demand growing slowly or declining. This

causes greater rivalry when it is difficult to leave the industry due to costs incurred

or failure to sell off fixed assets.

8. SWOT ANALYIS

i. Strength:

The strength of our company lies in its distinctive and quality services it offers to

its clients at competitive prices. Any work performed is assessed to ensure that it

has met quality standards set by its top management. The launch of our new

website has not gone unnoticed – it has improved customer liaison and acquired

new customers on the go. Customers are able reached the company at their

convenience.

CUTHBERT

CHINJI JNR

207014329

2010 ©



73 Bridgetown

Agulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.za



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ii. Weaknesses:

Despite the company’s strengths, it acknowledges the challenges that it currentlyfaces within the management. The top managing members that sit with

organisation’s power come from a diverse culture with little previous managerial

experience. This has made them difficult to secure many tenders.

Another concern is the presence of their website. Initially the website was

launched to enhance and integrate the business processes with its clients. The

website has so many flaws, first being static in nature which does not rely on user

input as opposed to modern dynamic websites that have captured the hearts of

many internet users. The website has very basic content that lacks an element of

marketing. This reduces its new potential customers.

iii. Opportunities:

The coming of soccer world cup has seen an economic boom in the construction

industry and we view this as an opportunity. We therefore intend to extend our

services on a wider platform to meet the growing needs of our clients.

iv. Threats:

The global economic meltdown poses the biggest threat by far in any industry and

our organisation is not exceptional to that. Customers’ spending power is reduced

and this slows down the economic growth of our business and we might eventually

find unbearable to meet our obligations and be forced out of the business.

9. FACTORS THAT CAUSE A FIRM TO DECLINE

Poor Management: The role of top management cannot be overlooked in the

success of any organisation and its failure equally is attributed to top management.

To curb this problem, our managers will undergo training to acquire necessaryskills from recognised institutions as well as attend workshops and seminars that

equip people with leadership skills and managerial skills.

Another approach is to have an open decentralised management leadership style

where staff members’ opinions in decision making would be valued. This creates a

free and open atmosphere between managers and staff members which in turn

promotes harmony in the organisation.

Lack marketing effort: Our marketing effort is constrained due to financial

hurdles. As a result, we do not have a strong client base. We have identified that by

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CHINJI JNR

207014329

2010 ©



73 Bridgetown

Agulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.za



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enhancing our website we could use it as our core marketing tool to reach new as

well existing customers.

10. SUCCESSFUL ORGANISATIONS

i. Strategic planning relationships:

These are relationships whereby the centre actively participates in strategy

development and implementation.

This does not necessary apply to ZBP since it is a single business unit. However, it

has partnered with SafeGuard as its core supplier for ZBP. This could see the twoorganisations develop long term perspectives and lead to business sharing ideas.

ii. Financial control relationships:

These relationships are defined on the basis of the main centre setting financial

targets and delegates strategy development to business units. This not only is

appropriate for urelatedly diversified corpaorations, but also helps motivate

managers to focus on short term performance and identify short-term weaknesses

in strategy.

iii. Strategic control planning:

These are intermediary relationships that lie between financial control relationships

and strategic planning relationships developed by the business units often

approved by the centre.

11. ANALYTICAL PROCESS

i. Preliminary Corporate analysis:

ZBP is a neatly structured and identifiable business that operates mostly aroundGauteng area, but also stretches its operations as far as Pretoria. It deals with

building, painting, renovations, and waterproofing of houses.

The organisation structure of Zengani is small. As a result communication between

the top management and staff members is quick and efficient.

The financial performance of ZBP is just above the average. However, it heavily

relies on a substantial upfront payment when a certain tender has been secured.CUTHBERT

CHINJI JNR

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2010 ©



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Bloubosrand

Randburg 2188

ww.zenganibp.co.za



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The suppliers as well as customers in conjunction with the employees are the

major stakeholders. Suppliers need to know our track credit record so that they

could be able to supply the organisation with resources on credit.

The customers need to know if they will get the best value for their money in

relation to the organisation’s services provided.

Similarly with employees as stakeholders, they would not work for a company that

has financial crisis.

Individual business analysis: ZBP generally consumers are those who own

houses including private institutions. Given its low cost of services/products

offered to its clients without compromising quality, this has made the consumers astheir number one priority.

The organisation as an independent entity has some setbacks – financially it cannot

fund or acquire big projects. However, given its size, it is easily manageable.

Summative Corporate analysis:

ZBP is heavily affected by the global economic down turn. The cost of raw

materials has substantially increased. To combat this phenomenon, we will acquire

resources in bucks during promotions to reduce costs.

Our management vision is to nurture the business so that it becomes a big empire

that will not only confine its operations to Gauteng Province but also to all South

African corridors.

12. STRATEGIC CHOICES AT THE TOP LEVELS

Business Disposal: Currently the organisation is in financial crisis. It does not

generate enough funds to meet its obligations. We are looking at selling the

business so that we can pay our out debts.

Business Acquisition: Another option that we had in mind is to extend our

services by offering related services as previously indicated.

Recommendation: In the interest of our clients and our society at large, we have

decided to look at other ways of raising money to meet our obligations. We will

sell out shares to the public at competitive prices instead of constantly borrowing

money from private institutions that charge us a lot of money.CUTHBERT

CHINJI JNR

207014329

2010 ©



73 Bridgetown

Agulhas RoadBloubosrand

Randburg 2188ww.zenganibp.co.z

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13. THE RESOURCE-BASED PERSPECTIVES

Heterogeneity of resources across the firm: We use unique resources that are

uniform across its firms. Employees and company vehicles have emblems that bear

the company logo. This helps them to be easily identified across the industry as

well as to its our clients. It is also part of the marketing strategy since the company

contact details are embedded on the emblem.

The acquisition price of assets: We will keep at least a considerable amount of

operating capital to take advantage of buying goods in bucks as well as those

running on promotions so that we could make more profits.

14. SPACE:

The financial strength of the business: Our Company does not have financial

strength. We cannot meet most of clients’ needs. We will raise money by selling

out shares to the general public so that we can remain in the industry. We will also

merge with a more cash-rich business in some form of conglomerate or concentric

merger to increase our financial muscle.

The strength of the industry: We operate in some sought of high competitive

market that involve high cost of production. So there is a striking balance between

cost and profitability levels. To gain competitiveness in the market, we will be

acquiring resources in bucks and offer our services at competitive prices to retain

as well as reach customers.

Factors that determine the strength of the industry include:

i. Growth potential

ii. Profit potential

iii. Financial stability

iv. Technology know-how

The degree of environmental stability: We have already implemented an online

web site to reflect the current trend in business environment which is inclined to

using technology in conducting business. We are reaching new customers with low

costs incurred that are geographically dispersed.


CUTHBERT

CHINJI JNR

207014329

2010 ©



73 Bridgetown

Agulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.z

a



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Factors that determine the degree of stability with the organisation compared to its

rivals include:

i) Technological changes

ii) Rate of inflation,

iii) Price range – competitive advantages

iv) Demand variability

The level of competitive advantage: We operate around Gauteng that has many

competitors. We are focusing on entering on the same market segment with new

services and by delivering high quality products and services at competitive prices.We believe this will give us some level of economic boom.

Factors that determine the level of competitive advantage of the business include:

i) Market share

ii) Product quality

iii) Customer loyalty

15. REFERENCES:

Williamson, D. (2004) ‘Strategic Management and Business Analysis’. UK:

Elsevier td..

Nelson, R . ( 1982) ‘ An Evolutionary Theory of Economic Change’ . Harvard

University.

Zengani Building Projects: ‘ Company Profile’ . www.zenganibp.co.za. Accessed:

20 th

April, 2010.

CUTHBERT

CHINJI JNR

207014329

2010 ©



73 BridgetownAgulhas Road

Bloubosrand

Randburg 2188

ww.zenganibp.co.za

Cuthbert - Business Analysis Project

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