Question 3

 
Raza Sdn Bhd specialises in manufacturing of motor vehicles in Malaysia. The company’s
production personnel are professionally trained technicians and engineers. Based on official
statistics, Raza Sdn. Bhd. controls 25% of Malaysia motor vehicle market. Over the years, Raza
Sdn. Bhd. have won the best car producer award for the past three years.
 
As part of their expansion plan, the management of Raza Sdn. Bhd. is planning to have a forward
integration through merging with a motor vehicle trading company, Rahman Motors Sdn Bhd. The
Business Development Advisor, Mr. Fernandez, told the management of Raza Sdn. Bhd that there
are three key elements of strategic planning process. These three elements are :
 
1) Understanding the business current status,
2) Determining the desired future business status and
3) Evaluating the methods to lead the business grow from current status to desired future
status.
 
Required:
 
You are required to identify and critically discuss key issues to be considered in Raza Sdn.
Bhd’s proposal based on the three key elements of strategic planning process.

INTI International College Subang

Past Semester Exam Question
August 2019 Session
Suggested Answers Guide For Question 3

1) Understand the business current status:

i) Lack of management experience in managing a motor vehicle trading company. The existing
workforce specialised only in motor vehicle manufacturing but not in trading/marketing motor
vehicles.
ii) 25% of Malaysian are using Raza Sdn Bhd motor vehicles. The management should
segregate and understand the existing customers with different profiles.
iii) The reputation of both companies in the market.
iv) Need to understand whether some of the existing custiomers are also the competitors of
Rahman Motors Sdn Bhd.
v) The current location of the business. Is it the outlet at an easy access and strategic location?
vi) The business operation management process and technologies used in the both
manufacturing and trading companies. I will be easier to merge both companies’ information
technology systems if both companies have similar protocol.
vii)The motor vehicle market shares and the status of business’ main competitors.
viii)The current financial structure and available finance for the business.
2) Determinng the desired future business status:
i) The business’ desired market status. The business targeted categories of customers.
ii) When both companies merged, Raza requires to manage the relationship with the existing
motor vehicle trading clients.
iii) It will be good if both factory and marketing outlets can be arranged within near distance.
iv) Integrate the information technology of both companies in order to ease coordination between
the two companies’ management.
v) Possess outlets at strategic locations in order to capture and provide services to customers
effectively and efficiently.
vi) Raza Sdn Bhd should appoint a management representative to be part of Rahman Motor’s
Sdn Bhd management team.
vii)Ensure continuous supply of quality motor vehicles to customers without failure.
3) Evaluating methods to lead the business grow from current status to desired future status:
i) Need to design a suitable method to integrate the information technology of both companies.
ii) Evaluate the cost and benefit either
1) To merge the business or
2) To acquire Rahman Motors Sdn Bhd as a separate entity.
i) Determine the required duration to grow from the current business conditions to the desired business status.
ii) Design appropriate continuous training for different categories of staff in order to enhance the staff service
capability.
iii) Design strategic marketing plan to widen the customer base.
iv) Establish technology maintenance team through either
1) Outsource professional technicians or
2) Recruit and form internal technology maintenance teams.
i) Invest in research in order to attain continuous innovative motor vehicles
ii) Design different promotion and service packages to different categories of customers.
iii) Prodive after sales services through periodic offer to the existing customers in order to build more loyal
customers.