Daytun
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Daytuns Current Strategy
Provision of exemplary customer, commercial and technical service as a corporate goal is inline with market requirements, and Daytun is able to provide this given their core activities. Having established solid dealers, and a well founded, extremely functional service department, one of its core activities to provide modern, up-to-date copiers, is now a very feasible probability for Daytun. The pioneering of the cost-per-copy idea, allows the customer to easily understand the underlying costs of high quality copies as a service station, rather than just a stationary machine.
This strategy model, founded on high quality products, excellent service, and competitive pricing, now stands to deliver the value proposition intended. Daytun is a customer driven industry leader in its own right, combining customer needs with company strengths, to provide a foundation for a well grounded long-term client-vendor relationship. (See Exhibit 1, for components of business strategy in Diamond-E model).
The Strategy-Environment Linkage
Their committing strategy to provide excellence in customer service and deliver quality products has brought them leading market share in the industry. Konica is providing them with quality products at competitive prices enable them competition within the market along big names like Xerox, Sharp and Canon. Customers base their purchase primarily on service and dealer reputation and Daytuns commitment to these factors has helped them grow in the market. The industry is maturing and future growth opportunity within London is under question. Competitors are aiming to increase market share through aggressive pricing, which can, consequently affect Daytuns sales (See Exhibit 2). In addition, Konica is in position to exercise their bargaining power, which could affect general operations of Daytun in the future. (See Exhibit 1)
The Strategy-Resources Linkage
Daytun has developed the necessary personnel and dealer base to carry out their strategy effectively. With a skilled and knowledgeable sales force, which can provide the right product for the individual needs of the customer. Furthermore, their service team is able to provide fast and reliable service, and is well linked to the customers through the well-trained dispatchers. (See Exhibit 1)
The Strategy-Management Preferences Linkages
Manager preferences have allowed the employees to develop the required skills to support the strategy. The culture of open communication and total participation has created a sense of responsibility and independence throughout the organization. There is strong emphasis on continual improvement of personal and professional skills, which allows the employees to keep up with the developing technology, as well as maintain a high moral working environment. There is no sign of conflict within the managers, their preferences, or the current strategy. (See Exhibit 1)
The Strategy-Organization Linkage
Daytun has adopted a corporate strategy that has made it successful in the London copy market. Their strategy fits well with their current environment and has allowed them to develop the kind of resources necessary to facilitate their growth into a market leader position. There is great autonomy within Daytuns management and they are committed to this winning strategy. In addition, Daytun has built its organizational capabilities based on culture of excellence in customer service and quality products. (See Exhibit1)
Future Goals & Strategy
In deciding on a future strategy for Daytun to address his goals, the president Doug Bell has to proceed with caution. Strategic change in the wrong direction will have severe effects on all aspects of Daytuns organization, and can potentially negatively curb the corporate alignment. Dougs current goal for growth has to be re-evaluated in light of the anticipated economic downturn, a maturing industry and other market forces outlined in exhibit 2. With a current increase in revenue of 6.9% (see exhibit 4), a growth rate of 67% in two years is not a sustainable target, and its pursuance will interfere with achieving the remaining goals outlined in exhibit 3.
Alternatives
With competitive changes in the sales environment for photocopies, and related products, it was imperative that Doug and Harvey expand their ideology into the realms of further company and brand name development. Running the risk of being overshadowed by the growing efforts of companies such as Xerox and Canon, Daytun was in dyer need of a new growth and development strategy, to ensure their place in the current and future market.
With product diversification, and market share development as the driving forces between possible implementation of a new growth plan, it was believed that Daytun could stand to greatly benefit from POS SYSTEMS market penetration (See Exhibit 7 for list of Alternatives). It could open doors for growth in the service support area, and corporate culture development. With no established brands in the POS market, Daytun could advantageously establish themselves as the leading contender.
Recommendation
Daytun must proceed with the acquisition of the local dealership for the POS systems company. The current company is highly service oriented and its value proposition is based on customer satisfaction to the point of operating on a break-even financial basis. Although the product and market focus of the POS company is naturally different from Daytun, its core activities and goals are aligned to provide similar value propositions to Daytun. Furthermore, the market base is primarily London area where Daytun has established its brand and reputation and could leverage this towards