1)

1. Strategic Capability

Strategic Capability of an organization is the capabilities of an organization that

contribute to its long-term survival or competitive advantage. In other terms, Strategic
capability refers to a business' ability to harness all its skills, capabilities and resources in
order to gain competitive advantage, and thus survive and increase its value over time.
Strategic Capability of a business can mainly be categorized under below given
categories.

o Physical
 Resources: Machinery, Material, Products, Databases, Systems
 Competence: Utilizing productively, flexibly, efficiently
o Financial
 Resources: Cash flow, Fund Supply
 Competence: Ability to raise funds, manage cash flows, debtors, creditors.
o Human
 Resources: Managers, Employees, Partners, Suppliers, Customers
 Competence: How to gain and utilize experiences, skills, knowledge,
Build relationships, Motivate & Innovate

2. Competitive advantage

The ability of an organization to outperform its competitor is known as competitive

advantage. The business entity can obtain competitive advantage either by providing
more value (benefit) or reducing the cost. In general use, there are four distinctive
capabilities required for sustainable competitive advantage namely Value, Rarity,
Inimitability and Organizational support.

 Value – The capability of create a value to the customer though the product or
service while generating profit to the company.
 Rarity – Posses of a unique capability over competitors in the industry.
 Inimitability – A capability that a competitor or a substitute would not be able to
imitate or highly costly to imitate.
  Organizational Support – The support from the organization to keep & improve
above capabilities.

3. Corporate Social Responsibility

Corporate social responsibility (CSR) is a self-regulating business model that helps a

company be socially accountable—to itself, its stakeholders, and the public. By
practicing corporate social responsibility, also called corporate citizenship, companies
can be conscious of the kind of impact they are having on all aspects of society, including
economic, social, and environmental.

To engage in CSR means that, in the ordinary course of business, a company is operating
in ways that enhance society and the environment. Through CSR programs, philanthropy,
and volunteer efforts, businesses can benefit society while boosting their brands.

Examples of Corporate Social Responsibility

 Environmental management, e.g. waste reduction and sustainability

 Responsible sourcing, e.g. using only fair trade ingredients
 Improvement of working standards and conditions
 Contributing to educational and social programs
 Employee volunteering
 Socially responsible investment
 Development of employee and community relations
4. Benchmarking

Benchmarking is a process of measuring the performance of a company’s products,

services, or processes against those of another business considered the best in the
industry. The point of benchmarking is to identify internal opportunities for
improvement. By studying companies with superior performance, breaking down what
makes such superior performance possible, and then comparing those processes to how
your business operates, you can implement changes that will yield significant
improvements.
 There are several benefits of benchmarking to a business entity. Ability to analyze
competitive advantage, monitor performance of the own entity, continuous improvement,
planning and goat setting are among the main advantages. The process of benchmarking
basically includes planning, collection of information, analysis of data, action and finally
monitoring.

5. Strategic Drift

Strategic drift can be defined as a gradual deterioration of competitive action that results
in the failure of an organization to acknowledge and respond to changes in the business
environment. Strategic drift usually arises from a combination of factors, including
business failing to adapt to a changing external environment, a discovery that what
worked before doesn’t work anymore, complacency sets in – often built on previous
success which management assume will continue and senior management deny there is a
problem, even when faced with the evidence.

Four stages of strategic drift are better demonstrated in below diagram.

2)
1. Porters Five Forces analysis
Porter's Five Forces is a model that identifies and analyzes five competitive forces that
shape every industry and helps determine an industry's weaknesses and strengths. Five
Forces analysis is frequently used to identify an industry's structure to determine
corporate strategy. Porter's model can be applied to any segment of the economy to
understand the level of competition within the industry and enhance a company's long-
term profitability. The five forces are frequently used to measure competition intensity,
attractiveness, and profitability of an industry or market.

i) Threat of new entrants

A company's power is also affected by the force of new entrants into its market. The
less time and money it costs for a competitor to enter a company's market and be an
effective competitor, the more an established company's position could be
significantly weakened

ii) Rivalry among existing competition

Number of competitors and their ability to undercut a company. The larger the
number of competitors, along with the number of equivalent products and services
they offer, the lesser the power of a company.

iii) Threat of substitute products or services

Substitute goods or services that can be used in place of a company's products or
services pose a threat. Companies that produce goods or services for which there are
no close substitutes will have more power to increase prices and lock in favorable
terms.

iv) Power of Buyers

A smaller and more powerful client base means that each customer has more power to
negotiate for lower prices and better deals. A company that has many, smaller,
independent customers will have an easier time charging higher prices to increase
profitability.
 v) Power of Suppliers
The fewer suppliers to an industry, the more a company would depend on a supplier.
As a result, the supplier has more power and can drive up input costs and push for
other advantages in trade.

2. Five forces analysis for the construction industry in Sri Lanka

i) Threat of new entrants
When entering the construction industry, a business entity requires to possess a
considerable amount of initial investment in labor as well as machineries required in
business continuation as the construction industry not only need staff but also huge
machineries, construction equipment, storing and yard facility etc. and also the
influence required from external parties such as political influence to be stable
considering nature of the industry. The political instability and also the current global
pandemic crisis has hit the construction industry of Sri Lanka thus by impacting the
small players trying to enter and establish in the industry. Considering five forces
analysis the threat of new entrants in reduced due to these reasons.

ii) Rivalry among existing competition

There are many key players in the construction industry of Sri Lanka (private sector)
who compete with other leading entities to win the major development projects in the
country. Though the threat for new entrants is high there can be seen a high rivalry
among the existing players in the industry. Construction companies are mostly
involved in submitting competitive tenders to win contracts. Because of the downturn
in the economy at the global level, the key main players in the industry try to sustain
by keeping their workforce occupant by securing more and more projects thus
increasing the rivalry among existing construction companies.

iii) Threat of substitute products or services

New and emerging innovative methods and processes within construction industry
has increased the threat of substitute products in Sri Lankan construction industry.
 With the increase of demand for modular construction concepts such as pre cast and
prefabricated houses, warehouses, storied building etc. which provides innovative
novel solutions despite of long passing construction projects has paved its way into
the industry. Factors such as lesser lead time in fabrication, cost effectiveness,
mobility and portability and many more has increased the threat of substitute products
in the industry. Example: Centralized distribution center for Camso Loadstar (Pvt)
Ltd, which is the largest warehouse in South East Asia, built using Pre Engineered
steel structures rather than conventional building techniques.

iv) Power of Buyers

The power of buyers of the construction industry in Sri Lanka is considerably high.
The major reasons being the construction developers having a high quality of
information for decision making, there being few developers and construction clients
compared to the many service providers available to deliver projects, a decline in the
developers and client’s demand for construction projects and developers and clients
having the ability to postpone projects until a later stage when they can secure lower
costs of building. This also can be considered as a downturn adverse effect of the
current pandemic situation as investors take extra precautions in their investments.

v) Power of Suppliers
There is a lesser bargaining power for suppliers as there are many suppliers available
in the industry to provide construction material in Sri Lanka as well as key
construction companies in the industry are integrating backwards in to the business of
suppliers. As an example it is seen almost all leading construction companies own
their own concrete batching plants, concrete block manufacturing plants etc. hence
reducing the opportunities of outside suppliers to penetrate into the market. When
considering high spec products such as control systems, high pressure pumps it can be
stated that power of suppliers are considerably high as there are limited number of
suppliers creating a higher bargaining power among the limited available suppliers.
3) Cultural web of my working place – Hayleys Advantis

The Paradigm
The paradigm is better demonstrated below (HAYLEYS & I)
Stories
Employees know many stories about the years long history of the company. About how it
started exporting local products, spices, coir yarn and essential oils and then diversified into
agriculture, manufacturing and service industries, winning acclaim as a ‘Superbrand’. The
most talked icon in the company is Chairman Dhammika Perera richest man in the country
and the majority shareholder in the group. Stories about how he turned up the business in
difficult times are often talked in the lunchroom.

Symbols
The logo of Hayleys group demonstrates all the major fields the business operates which is
considered as an iconic symbol in the corporate world. The main building where the head
office locates at is also considered as an iconic piece. Hayley and Kenny the two founding
pillars of the company have purchased Thurburn Stores, 400, Deans Road premises in year
1913, which is known as the Thurburn wing at present times.

Power structures
At Hayleys Advantis the power structure is more of an equally divided structure among the
departments. The SBUs are controlled by a General Manager or a Director in which different
departments are formed considering different products and services. The divisions among the
department such as marketing division, finance division, production division etc. are
considered equally responsible for the product/service delivery.

Organizational structure
The two individuals Chairman/Chief Executive Mr. Mohan Pandithage and Mr. Dhammika
Perera Co-Chairman (Non-executive) head the company. The Group Management
Committee consists of nine Managing Directors under which each pillar of business is
designated to.
Control systems
The company code of ethics is the main controlling mechanism for all employees serving in
the organization and the manual of the same has been provided to all employees. Daily
Management System(DMS), control charts, Lean Management system, Quality Management
System and such are used within the organization to control all the activities and functions.

Rituals and routines

When considering the rituals and routines within the Hayleys group and particularly at
Hayleys Advantis one of the key points at our SBU is that employees in the company respect
their religions every day at 8.00 am or before starting office work as one family. Safety
meeting for shop floor workers are conducted on weekly basic and a monthly safety meeting
is conducted by gathering both shop floor safety wardens and office staff to discuss and
evaluate monthly safety activities. Other than for the formal rituals and routines, the month
end is considered as milestone where all the jobs needed to be closed, POs to be raised and
accounts to be finalized and a friendly afternoon drink the very next day is a mandatory
routine of the staff.
4) “Balance score card is an important tool in implementing strategy”

I agree with the quote.

A balanced scorecard is a strategic management performance metric used to identify and
improve various internal business functions and their resulting external outcomes. Balanced
scorecards are used to measure and provide feedback to organizations. Data collection is
crucial to providing quantitative results as managers and executives gather and interpret the
information and use it to make better decisions for the organization. Traditionally, companies
have judged their health by how much money they make. Financial measures are definitely
important, but they only give you part of the picture. They focus on the short-term, and
you’re trying to build an organization to stand the test of time. The name “balanced
scorecard” comes from the idea of looking at strategic measures in addition to traditional
financial measures to get a more “balanced” view of performance.

The balanced scorecard model reinforces good behavior in an organization by isolating four
separate areas that need to be analyzed. These four areas, also called legs, involve learning
and growth, business processes, customers, and finance.

Modern balanced scorecards show how each perspective builds on the previous one. If you
train your employees and build a culture of
information sharing (Learning and Growth), they’ll
make your company run more smoothly (Internal
Business Processes). A better running business takes
better care of its customers (Customer), and happy
customers buy more of what you’re selling
(Financial).
 Thus covering the whole of your business strategy, a balanced scorecard is an important tool
to implement, track, measure and verify the company’s business strategy.

5) Light Rail Transit (LRT) project is the first of its kind to be developed in Sri Lanka,
connecting the main cities within the country. The project is expected to reduce traffic
congestion, travel time between main cities, and encourage the citizens to make use of
affordable and more convenient way of public transportation. It will offer an emission-free
travel experience to passengers and reduce the carbon footprint of the country.

1. PESTEL analysis of transportation.

Political : The country in the present day is in the transitional phase. The
Constituent Assembly Polls being the major issue so various other matters are
overlooked. The existing political instability as the constituent election has successfully
completed is anticipated to be stabilize, which will certainly help the business
environment to become favorable in the country.
Main factors to consider
 Political stability of the country
 Interference/influence of politicians for mega projects
 Local political pressure
 Non-availability of national policies related to many concerned areas

Economical : The Macro environment factors such as – inflation rate, savings rate,
interest rate, foreign exchange rate and economic cycle determine the aggregate demand
and aggregate investment in an economy. While microenvironment factors such as
competition norms affect the competitive advantage of the firm. Light Rail Company can
use country’s economic factor such as growth rate, inflation & industry’s economic
indicators to forecast the growth of transportation industry
Social : Society’s culture and way of doing things affect the culture of an
organization in an environment. Shared beliefs and attitudes of the population play a
great role in how marketers at Light Rail Company will understand the customers of a
given market and how they design the marketing message for Transportation industry
consumers. Social factors that leadership of Light Rail Company should analyze for
PESTEL analysis includes objections of the public demanding higher compensations,
loss for the business crowd due to change in location, dealing with traffic during
construction etc.

Technological : Over the last 5 years, the industry has been transforming really
fast, not even giving chance to the established players to cope with the changes. Taxi
industry is now dominated by players like Uber and Pickme. Car industry is fast moving
toward automation led by technology firm such as Google & manufacturing is disrupted
by Tesla, which has stated an electronic car revolution.
Technology analysis should involve understanding that there is no experienced engineers
available in the country related to the subject area and that the technology itself is novel
to the country. Also many cities proposed for the project have unplanned city
development with less details about utility plans.

Environmental : Some of the environmental factors that a firm should consider

beforehand are:
 Weather/Climate change
 Laws regulating environment pollution
 Air and water pollution regulations in Transportation industry
 Recycling
 Waste management in Services sector
 Attitudes toward “green” or ecological products
 Endangered species
 Attitudes toward and support for renewable energy
 Legal : In Sri Lanka, the legal framework and institutions are not robust
enough to protect the intellectual property rights of an organization. And there are no
laws formed pertaining to the Light Rail system in public transportation. The firm should
carefully evaluate before entering the market as it can lead to complicated situation as the
firm plan to operate the system as well (BOO)

2. Five force analysis

Threat of new entrants
Entry barriers for a similar kind of transport mode is very high. Moreover, the investment
required in developing the infrastructure required for the railway system from scratch
would be very high. Thereby making it very difficult for a new entrant to enter into the
industry when there is already an implemented LRT system in place.

Rivalry in the industry

Internal competition with a service provider supplying the same service is negligible as
this is the first Light Rail system to be implemented in the country.

Threat of substitute service

Threat of substitute service is low considering the nature of the project. The project will
come with its own benefits, which will overpass the weaknesses in current transportation
system. The only threat possible of substitute service is if the highway network
connecting all main cities in Sri Lanka is implemented which will again take a
considerable period of time for construction.

Power of suppliers
When considering the power of suppliers there would be minimal power for local
suppliers as the procurement of major items for the project would be done from
international suppliers thus creating a pool of available suppliers to provide required
material/machinery and technological advancements. The little power will lie among
 local suppliers in providing material for the infrastructure development related to the
project (concrete/labor)

Power of buyers
The buyers of this service would be the commuters who are receiving the service of the
Light Rail system. As the system comes with many advantages overcoming the
shortcomings observed in the current transportation system, many users will start
receiving the service thus reducing the need as well as the requirement of bargaining for
the price paid in receiving the service.
3. Best mode of entry

Joint Venture

Considering the nature of the project, the best mode of entry can be considered as
forming a joint venture with one well-established local developer in Sri Lanka. The main
reason that the project plans to connect few major cities in the country it is always
beneficial to possess knowledge about the local market, culture and people when
planning to make a drastic change in their lives. Sharing of financial responsibility,
control of local political pressure would also be major advantages in joining with a local
market leader.

However, conflicts and delays in taking decisions as there are multiple parties involved
would be a disadvantage of the mode.

Fully owned subsidiary

Based on the gravity of the project to be implemented in Sri Lanka, it would not be
recommended to go for a fully owned subsidiary. The main strategic disadvantage is that
cultural differences often lead to problems integrating a subsidiary’s people and
processes into the system of the multi-national company. Thus creating complications in
the management of the project.

Foreign Investment laws, Business laws, Construction laws & consumer protection laws
would also be involved alongside with labor law during the implementation of this
project. Moreover, a fair number of government departments and authorities such as
 Road Development Authority (RDA), Pradeshiya Saba, Irrigation Department, Municipal
council, Forrest conservation Authority, Wild Life Department, Sri Lanka Police, and
other related authorities will be involved in different phases of the project. Thereby
starting from the documentation process all the stages would require the expertise of local
experts whom would cooperate relentlessly for the completion of the project which can
easily be acquired through a joint venture rather going for a fully owned subsidiary.

4. Risk analysis for the project

The risks for the project are identified under four main categories.

External Risks

When considering the external risks, the risks involving with suppliers are minimum for
this project due to the reliability of related suppliers such as Electricity and Water and
also the provision of main machinery required for the project are imported to the country.
Risk involved with consumers can be minimized though a quality service, since good
public transportation service is a essential necessity in the country.

Internal Risks
The project being the first of its kind creates a significant internal risk as there no
competent and experienced personals in the field to recruit as employees. Proper training
and guidance would eliminate this risk in technical sections for certain extend and the
balance competency can be fulfilled by acquiring foreign experts. Other key requirement
areas such management, finance, marketing, IT etc can be fulfilled within the country.

Project Risk
Technical capability other than civil construction is rare in the country due to the lack of
similar projects undertaken. The process of procurement of the machineries required and
fulfilling the logistical need of the same would be a complex process. Risk of the project
getting delayed due to these reasons can be minimized by proper coordination and
acquiring the correct requirement of knowledge and competency to handle the supply
chain of the project

Event Risk

The risk of political change is possible due to the unstable political situation of the
country. The economic situation of the country is moderately stable with large amount of
medium earning population with a debt depending economy.

The following issues, constraints and challenges should further be considered in

analyzing the risk of the project.
 Political interference and decision changes
 Issues in getting recommendations/approvals from various government
organizations
 Change of government regulations from time to time
 Energy price fluctuations
 Trade Union issues
 Affordability of the service
 Geographical issues during construction