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Zealand Institute of Business and Technology, campus Roskilde ‘’Up cycling to a better future’’ Developing a strategy for internalization and increasing revenue By Trandafir Dimache Daniel Date: 16.12.2016 Field of study: Bachelor Thesis Guidance professor: Thoger Cathersen Characters:82 936

Transcript of PBA- LICENTA

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Zealand Institute of Business and Technology, campus Roskilde

‘’Up cycling to a better future’’

Developing a strategy for internalization and

increasing revenue

By Trandafir Dimache Daniel

Date: 16.12.2016

Field of study: Bachelor Thesis

Guidance professor: Thoger Cathersen

Characters:82 936

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Table of Contents

INTRODUCTION ..................................................................................................................................................... 4

PURPOSE OF THE PAPER ................................................................................................................................................... 4

PROBLEM FORMULATION AND SUB QUESTIONS ..................................................................................................................... 5

METHODOLOGY ............................................................................................................................................................. 5

RELIABILITY AND VALIDITY ................................................................................................................................................ 6

LIMITATIONS ................................................................................................................................................................. 6

COMPANY BACKGROUND ................................................................................................................................................. 7

Products and services ............................................................................................................................................ 7

Mission and vision ................................................................................................................................................. 8

Vision: ................................................................................................................................................................... 9

Organizational background and core competencies ............................................................................................. 9

Core competencies .............................................................................................................................................. 10

THEORETICAL BACKGROUND ........................................................................................................................................... 10

First part .............................................................................................................................................................. 10

Second part ......................................................................................................................................................... 10

Third part ............................................................................................................................................................ 11

INTERNAL ANALYSIS OF ABOUT INNOVATION ..................................................................................................... 12

VALUE CHAIN ANALYSIS ................................................................................................................................................. 12

Inbound ............................................................................................................................................................... 12

Operations .......................................................................................................................................................... 12

Marketing communications and sales ................................................................................................................ 13

Secondary activities ............................................................................................................................................ 13

THE BUSINESS MODEL OF ABOUT INNOVATION AT THE MOMENT ........................................................................................... 14

Value proposition ................................................................................................................................................ 14

Customer segments ............................................................................................................................................ 15

Channels .............................................................................................................................................................. 15

Customer relationships ....................................................................................................................................... 15

Revenue streams ................................................................................................................................................. 15

Key resources ...................................................................................................................................................... 16

Key activities ....................................................................................................................................................... 16

Key partnership ................................................................................................................................................... 16

Cost structure ...................................................................................................................................................... 16

COMPETITIVE STRATEGY ................................................................................................................................................ 16

EXTERNAL ANALYSIS ............................................................................................................................................ 17

PESTLE ..................................................................................................................................................................... 17

Political and Legal factors ................................................................................................................................... 17

Economic factors ................................................................................................................................................. 18

Social factors ....................................................................................................................................................... 19

Technological factors .......................................................................................................................................... 20

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PORTE 5 FORCES .......................................................................................................................................................... 20

Supplier power .................................................................................................................................................... 20

Buyer power ........................................................................................................................................................ 20

Treat of substitutes ............................................................................................................................................. 20

Threat of new entry............................................................................................................................................. 21

COMPETITOR ANALYSIS FOR THE DANISH AND THE SWEDISH MARKET ..................................................................................... 21

Competitor analysis for CanAltRedesign and Recreatedesign. ........................................................................... 22

BENCHMARKING .......................................................................................................................................................... 25

Key features of About Innovation ....................................................................................................................... 25

How About Innovation will be able to support their key features on the future................................................. 25

SWOT ....................................................................................................................................................................... 26

Strengths and weaknesses of About Innovation ................................................................................................. 26

Treats and opportunities ..................................................................................................................................... 27

PART CONCLUSION FOR THE EXTERNAL ANALYSIS ................................................................................................................. 27

IMPLEMENTATION PLAN ..................................................................................................................................... 27

ANSOFF GROWTH MATRIX ............................................................................................................................................. 28

INTERNALIZATION STRATEGY ........................................................................................................................................... 29

Stay at home and Born Global –two step strategy ............................................................................................. 29

BLUE OCEAN STRATEGY ................................................................................................................................................. 30

Strategy canvas ................................................................................................................................................... 30

Four action framework ....................................................................................................................................... 30

BUSINESS MODEL TO BE ................................................................................................................................................. 30

Value proposition ................................................................................................................................................ 31

Customer segments ............................................................................................................................................ 32

Customer relationships ....................................................................................................................................... 32

Channels .............................................................................................................................................................. 32

Revenue streams ................................................................................................................................................. 33

Key resources ...................................................................................................................................................... 33

Key activities ....................................................................................................................................................... 33

Key partners ........................................................................................................................................................ 33

Cost structure ...................................................................................................................................................... 33

BUDGET ..................................................................................................................................................................... 33

MARKETING PLAN ........................................................................................................................................................ 35

Advertising .......................................................................................................................................................... 36

Public relations .................................................................................................................................................... 36

Lead conversion .................................................................................................................................................. 37

Sales forecast ...................................................................................................................................................... 37

Budget for the marketing plan ............................................................................................................................ 37

Key performance indicators for the marketing program .................................................................................... 37

MARKETING MIX .......................................................................................................................................................... 37

Product ................................................................................................................................................................ 37

Price .................................................................................................................................................................... 38

Place .................................................................................................................................................................... 38

Promotion ........................................................................................................................................................... 39

SALES STRATEGY ........................................................................................................................................................... 39

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Tasks ................................................................................................................................................................... 39

CUSTOMER RELATIONSHIP MANAGEMENT ......................................................................................................................... 39

BALANCE SCORECARD .................................................................................................................................................... 40

The financial perspective .................................................................................................................................... 40

Customer perspective .......................................................................................................................................... 40

Internal perspective ............................................................................................................................................ 40

Learning and growth ........................................................................................................................................... 40

FINAL CONCLUSIONS ........................................................................................................................................... 41

REFERENCE LIST ................................................................................................................................................... 43

APPENDIX ............................................................................................................................................................ 43

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Introduction

Purpose of the paper

This paper is meant to be a representation of my abilities to apply the theoretical knowledge that had

been acquired during the study program. Having an internship presents a great opportunity for me to

apply the theories and models into the real life situation and subsequently understand what it is

different. Writing this paper also allowed me to understand the company from a different perspective,

fact that it is valuable for me and also valuable for the management of About Innovation.

My main goal with my research was to make the company more competitive in the market so that they

can generate some revenue. Having analyzed the company and spending three months working with the

team gave me an understanding of what is it that they are aiming at, their vision for the future and it

made me believe that a concept like theirs based on sustainability and environmental concern can be

valuable for this world. I also comprised what is that the company is good at and what is there to be

improved and after balancing the two I arrived to the conclusion that the company is capable of growth.

I went further and seek opportunities from the outer environment to better understand the position

that the company has within the market and the industry itself.

Not everything comprised in the research is fixed or countable; many suggestions are hypothesis, such

as the development of a new market in the blue ocean strategy. The plan was to show that in theory it is

possible to develop new markets with less competition.

Nonetheless, an important factor was to be clearer about the services and the potential customers so

that the company will know what to improve to reach their needs and pains. I had to reorganize the

business model for the future competitiveness and in this way I managed to uncover better value

propositions and customer profiles.

Because About Innovation is a startup and they do things by instinct most of the times, I have tried to

put down some objectives so that it is easier to reach their main goal, also I presented some

measurements for the objectives that could be tracked every month or week and are not very time

consuming. Some of the objectives might seem unrelated or the measurements are not very accurate,

but it is normal, as it is up to the management of the company to change them to more appropriate

ones due to the time and resources at their disposal.

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Problem formulation and sub questions The problem formulation is being set up with the coordination of the supervising teacher, the problem

formulation should be achievable and also it was based on what the company needs more at the

moment, which is capital. As a startup, the company is in development and the need for investment is

considerable, therefore a plan for gaining more revenue on the future had been based on the expansion

to the Swedish market. The problem formulation is:

‘What does About Innovation need in order to achieve a revenue growth of 20 000 Dkk for the following

year on the Danish market and what is the strategy for expansion on the Swedish market?

The problem formulation will be dividing into sub questions so that we can outline what are the needed

analysis and theories to reach to a solution for the problem formulation.

Is the structure of the organization able to manage the resources the company has in order to support a

market penetration strategy on the Danish market?

What will influence the development of the company from the external environment, what are the

opportunities?

Who else is selling on the Danish and the Swedish market?

Does the company need to improve the business model to be able to compete?

How can the company communicate and sale over the competition in both markets?

Methodology In this paper I have used the qualitative type of approach to uncover what are the needs and pains when

companies need their employees to work with creativity and innovation, in the same way how school

teachers as for example the ones from ZIBAT manage to communicate the theories and model to the

students and if the students are involved in the learning process. Furthermore I wanted to find out if

they will be willing to implement a third party service to allow both the students and the teachers to

practically learn and teach sustainability, creativity and Innovation by using the framework of a

workshop. The interview comprised open questions so that a broader understanding can be assessed

and it served also as an opportunity to probe my assumptions. Due to the fact that the teachers did not

participate in the study, the research could not be conducted and assumptions had to be created based

on the observations from the class. This research was meant to help me understand how to better plan

the value propositions for the creativity and innovation workshops About Innovation is offering.

Analyzing the theories and models that I have been taught, and combining them with the observations I

have collected while being in my internship from the team and also from what I have seen, I have used

deductive approach to be able to outline what is the development of the company internally.

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Moving on the external environment, I have search for appropriate data so that I could asses an outlook

of the country, PESTLE, the industry and the competitors. The type of data was secondary data complied

into databases such as Worldbank or Danmark statistics, articles and discussion on forums.

Lastly, I used inductive approach to formulate the strategies for the marketing and sales. My

observations over the outer medium and the internal have brought me to create a new business model

for the company and a balance scorecard to follow their objectives.

Reliability and validity The reliability of the sources I have used while building the theoretical background of the paper have

been comprised into textbooks, some of them have been studied in school. Given this fact we can say

that the reliability of this part of the paper is high. Naturally, for the born global perspective there is a

criticism in what concerns the applicability of the strategy, it states that the company should have a high

capital and a large network to successfully implement the strategy. Another criticism is that the business

model canvas does not take into considerations the external environment, or in other words the

presence of competition.

Among the references I have used to gather data and analyze and further create the marketing and sales

strategies are being comprised the competitor’s websites. The websites reliability it is nit to be fully

trusted as it can be a marketing strategy to appear appealing to the customers and in the same way the

information structured can be different from what they actually can deliver.

The internal validity it is to be trusted, the information is first hand collected and the theories and

models are being acknowledged in textbooks in the class and onside.

For the external validity, if we weight both the official websites, academic articles and books used, with

the other sources such as databases and the competitor’s websites I could say that we have a limited

level of validity.

Limitations One of the limitations was the time constraints; I consider that more hypotheses could have been

further tested by conducting qualitative research with companies to find out the specific needs and

pains they encounter when designing their locations. Subsequently, a better approach and solutions

could have been addressed.

Another limitation is the choice of theories, with the balance scorecard I have managed to bring a visual

representation of the objectives and the implications as in what concerns the time invested to make

them happen. I chose to leave out another important model that could have helped as well to

understand the distribution of the costs, ABC costing.

Given the fact that the up cycling market is not yet a mature market and there are not so many

information on the practices within the market and also the customers are not well known, what have

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been discovered and interpreted in the customer segments comprised the business model it is a

representations of what it seems rational to me and it needs to be further investigated.

In the problem formulation I have proposed that the company should also pursue a internalization

strategy for Sweden. My research has been focused more on understanding and attaining customers on

the Danish market and less for the Swedish one.

In the internalization strategy I suggested a two-step internalization strategy. Born global and stay at,

but in order for the company to actually realize a born global strategy many resources would be needed,

more than the ones the company can get by staying at home. In the meantime the industry will develop

more and stronger competitors can pursue the strategy.

Company background About Innovation it is a concept that had been envisioned by a Danish teacher and entrepreneur. The

core of the concept is to reuse discarded materials that can be from wood, textiles, plastic, and anything

that can be up cycled.

The waste empire it is in the making has two dimensions at the base, designing up cycled products and

circular economy. As the idea of recycling is not new, other people that heard of About Innovation

wanted to join, there was the moment when Green Design Base joined and a team got created. Green

design base is comprised of two persons, both sharing passion for wood crafts so from there it all

started the manufacturing of products.

I have been the third person that joined the team at that time and I created a series of videos for the

promotion of the company and uploaded them on YouTube.

Their head office can be found at INSP, where many people are willing to learn new skill, so by

conducting a set of meetings more people seems interested in the ideas that we were sharing and

joined as well. Their skills varied from textiles, to nudging and to online communications. The company

has a varied set of skills and it is growing to become more homogenous.

The company officially had been registered in October 2016 as a enkeltmandsvirksomehed , which

stands for privately owned company where there is only one owner that is fully liable for everything that

happens with the company and fully entitled to what the company has, despite the fact that at the

present time the company is not generating very little sales.

The team at the moment is showing great intentions and the people around are acknowledging their

efforts and supports them as well financially. One of the company goals is to establish their own venue

and start production.

What I am going to work with in regards to the development of the company is to see how the company

can become more competitive and start earning money.

Products and services

So far the company managed to create benches, pillows, apple boxes and organize workshops.

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The products made are made fully from recycled materials, mostly coming from the Roskilde Festival

waste.

Benches: made from oak planks that are more than 100 years old, these benches are simple as design

and can hold the time test for more than 400 year.

Pillows: made from the old pillows and blankets from the festival, these pillows re innovative as design

due to the distinctive shape that can hold the back of the user in an ergonomic way and it also can serve

more functions, as for example when a person is reading or writing on their computer.

Apple boxes: main material used was wood from recycled pallets, simple as design, these boxed draw

the attention of a local apple juice supplier that purchased a bunch of them.

Workshops: Mainly, the workshops were designed to bring more recognition of the intentions that

About Innovation has and receive direct feedback from the public. The events have the intentioned

results and even more, the last event organized brought the team monetary benefits as well besides the

promotion. It seems that the potential of these workshops can be enlarged and further explored.

All the products made are unique due to the different resources are being gathered. It will be therefore

more difficult for the company to conduct activities such as design, produce functional products nut just

prototypes, advertise and sell due to the uniqueness of the products. Another way that can be less time-

consuming and maybe more profitable could be the creation of projects for restaurants and cafes.

Mission and vision

Mission statement should be covering three main areas of importance, as for example what is it that the

company does in regards to its customers.

About Innovations is putting great effort in creating unique design that can surprise the customer and

make them feel and understand that waste can be beautiful and in the same way useful.

Second, mission statement has to comprise the relation that it has with its employees. Given the fact

that the employees are the ones that are creating the value for the customers, it is equally important

that the relation between them and the management it is showing opportunities for growth and

possibility of expressing themselves in a creative and innovative environment.

The third and last highlights what is that the employees do that it is valued by the customers and brings

revenue and recognition for the owner.

This is the mission statement that About Innovation has:

‘’Our missions is to invest our creativity in how to reuse and reshape the waste culture. ‘’

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Vision:

Given the last progress that the company had in the previous competitions and the meeting that they

had with the municipality, it seems that the vision of the company is sound and reliable for future

growth of the concept of recycling and global waste culture. There is still work to be done in what

concerns the company’s ability to bring the vision to the world in a way that is understood and

supported.

The management envisions a world where the waste is treated as primary resource. With the help of

innovation and creativity these resources can be manufactured and transformed into meaningful

objects once again. The concept is rooted into the desire to reduce waste globally and reduce the need

for new raw materials on the long run. They support the concept of circular economy and believe it

could be applied worldwide and it will benefit many people, industries, and the environment itself.

Organizational background and core competencies

The organization is constantly expanding and acquiring new people that are willing to use their creative

minds to make something meaningful for the world around. The company will continue expanding until

the right combination of skills, knowledge and execution is met .

The present formation is being composed by Zenja Jorgensen. She is the owner of the company and the

founder of the concept described earlier in the vision. Zenja is a teacher and in her spare time an

entrepreneur. Her skills are to create a powerful network and manage the events and PR.

About Innovation started with three members, two of them having their own project called Green

Design Base. Sanne Noer is one of the founders of GDB . Sanne is a wood creator and is also doing the

prototyping for the products alongside Henrick Christensen. Henrick is an enthusiast and has the

knowhow of the manufacturing processes, during the events he is helping with supplying the needed

materials.

The following are Theresa Olsen that is taking care of the online communications, the structure of the

company, compiling and registering the company’s data into database, creating advertising content and

helping in the everyday activities.

Rosen Lozev it is a Bulgarian recycling enthusiast that managed to raise attention from the public on the

effects of cigarette buds over the environment. He finished his education at RUC University with a

degree in Environmental Planning. Rosen is also the founder of Keep RUC Clean1.

Daniel Trandafir it is a student at ZIBAT currently finishing his PBA in sales and marketing. He worked

before with bike events in Roskilde called Tour D’Night .He helped with the creation of videos for the

woodwork shop and other promotional videos and posters and made a YouTube channel to make them

known to the public. He also has helped with the negotiation of a project with one of the local

restaurants and with the building of the team by creating a teambuilding exercise2.

1 https://www.facebook.com/pg/KeepRucClean/about/?ref=page_internal 12.12.2016

2 https://www.facebook.com/1Humblemind/

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Core competencies

The team that I have described above in the organizational structure has a unique set of skills that

allows the company to perform the following actions:

To develop unique creative workshops

To develop new products and develop new ways to reuse materials

Can find the needed people to increase the success of the business

Theoretical background In the theoretical background I will show the models and theories that will allow the company to

internalize and to be able to compete and subsequently generate revenue.

First part: Naturally, we start with an emphasis on the first part of the paper where we are conducting

the internal analysis. It is important to understand how is the company is able to bring value to its

customers, that is why it is useful to understand the composition of the value chain. For any company,

the values proposed needs to be further transferred to the customers; the value chain model itself does

not allow us to understand how the customers will get to benefit from our goods and services that is

why Business Model Canvas becomes useful. With the business model canvas we are able to display the

relations between the value proposition discovered earlier and the network with the customers,

partners, costs and revenue.

If it is possible to compete through a strong value chain and business model you can also compete

having a strategy. We can assess what is the strategy of the company for the present time according to

Michael Porter and his competitive strategy model. The model will allow us to understand what are the

risks with every strategy are and when it is the right time to use any of them according to the external

factors that are influencing the performance of the company.

Second part: the second part is focused on the gathering of the right information for executing a

efficient internalization strategy, Given the fact that globalization lf enterprises is becoming a large

phenomenon every company nowadays should have in mind their opportunities and treats.

The internalization starts with assessing what is the right country to expand to. The most appropriate

countries are the ones that are as closest as possible to the culture, political environment and

nonetheless the economy within that country.

For that reason PESTLE is a good model to help us analyze the potential treats and opportunities of the

political situation, the economy of the country, legal, social and technological.

The economic factor from pest is being comprised by the overall performance of the industries within

the country, for that reason Porter developed the model Porter 5 forces. With this model we are able to

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understand the rivalry in the market. Rivalry can be also understood if we look at the competition itself

as well.

To better weight the success of the internalization we will also have to keep count of the competition,

both in Denmark and on the foreign market. For that purpose, a competitor analysis of the companies

that offers similar services and products will come in handy. We can analyze the competition by looking

at their target market, the competitive advantage and partly the marketing mix each of them has.

With the competitor analysis we look at each competitor individually with no relation to About

Innovation that is why we need conduct a competitor benchmark so we will combine the information.

With the benchmark we compare two or more competitors with About Innovation with the scope of

finding out what are the competitive advantages of About Innovation. Competitive advantages are listed

as key features and only the ones that help the company position themselves ahead of these

competitors will be further pursued. By conducting the above mentioned models we can comprise a

SWOT where we will note the strengths, weaknesses, threats and opportunities fact that will allow us to

be clear of what assists the company in their development and what obstacles must be overcome or

minimized in order to achieve the desired results.

Third part: So far we should have enough information from both mediums to be able to set a growth

strategy. As we mentioned earlier, the rivalry is important for growth and with Ansoff Growth matrix we

are able to find the appropriate strategy to grow and keep a stable position within the market.

The internalization strategy starts with the will to earn more and according to the 9 strategic window

models for internalization; the most profitable model is born global. The model has downsizes, the

company needs to hold a strong network, for two reasons, one is capital and the second is the right

people to foster a fast expansion that can also be simultaneously. For this reason I have chosen to

complement the born global with another model, stay at home. Due to the fact that About Innovation it

is a startup and they need to understand better their customers and define their offerings. Also during

this time the company can find the right network for implementing the born global approach.

When pursuing a born global approach, it is important that the company is aligned with their products

and services to a low treat of rivalry. Blue ocean strategy has been designed exactly for the purpose of

helping companies to find new markets that lack competition.

By compiling the information from the competitors, benchmark, internalization strategy and Blue Ocean

we see that we have to reshape the business model canvas so that About Innovation is able to bring

improved value propositions tailored according to the direction that the company is heading to.

According to the problem formulation and the information gathered we will have to make plan to

communicate the new value proposition to the market, subsequently we will have to make a budget as

well to see what are the potential expenses and the income for the following years.

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For an appropriate follow up of the marketing plan, the balance scorecard model will be useful as it will

combine the goals and objectives set in the marketing plan and it will as well offer measurements to see

the progress of the objectives.

Internal analysis of About Innovation

Value chain analysis

With the value chain analysis we would be able to bring the concept ideas and the innovation

to life. Going through a series of steps, the ‘’value’’ of the products is being added and

subsequently it will be done so until it reaches the client or the user.

The primary activities that had been identified as primordial are the following: inbound,

operations, marketing communications and sales.

Inbound

Inbound is the first step in the making of the value chain for About Innovation. At this stage the

company is procuring the right ingredients for the upcoming productions and events materials.

As long as About Innovation is focused mainly on using discarded materials for their projects it

is more than essential to go and collect such materials. In this way, the board had been

scheduling different times in the year when the whole team is preparing for collection and

storage. As it happens every year, at Roskilde Festival, the amount of trash is generated by the

attendants is huge and the quality of the materials left behind is still reasonable and can be

reused. Therefore, About Innovation is creating dumpsters where people can recycle in a

different manner the tents, blankets, sleeping bags, and so forth.

The collection of resources can also be on the spot. If there is a viable idea for an event, for

example the ‘’bicycle flowers’’ (textile flowers made on the old bike wheels), people go and pick

the necessary goods.

Operations

In the operations stage, About Innovation is manufacturing the products. For that, the company

has a partnership with the nonprofit organization called INSP established in Roskilde. This

organization has access to a variety of materials and tools that can be used for free for the

people that are interested. Therefore, About Innovation can use the wood workshop where

they are manufacturing the different furniture merchandise. Keeping cost low is a must for

About Innovation, as they are at the beginning and financing is made out of donations or

personal spending, the company has received a storage room as well where the goods can wait

until they are being sold. About Innovation have operations in other places as well. Rosen

Lozev, one of the team members is manufacturing signs and laser cut labels for various needs in

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one of the RUC laboratories. In the same way, Sanne Noer, had set up a small workshop In her

house for the manufacturing of the textiles. She is sewing pillows.

Marketing communications and sales

As every startup company that is in the incipient stage, this step involves the creation of a

marketing plan and making a sales strategy. So far the company had been building a series of

events to increase the appearance for the public and get more network prospects. In this way,

About Innovation had been organizing their company opening where friends and the people

interested in sustainability and recycling had been invited. At the event, every person from the

team held a speech where they presented their vision within the company borders to the rest

of the invites. Also they have set up a revenue scheme by selling support bonds. Each of the

bonds was valued of 200 kr. About Innovation went further with the events and created the

lamp event. The Danish Halloween national day was the day of the event so many people got

the chance to take a look at what was their intention and also got to see the creative minds at

work. The event place was the city square in Roskilde, so a populated area, and given the fact

that the Danish holyday was also a booster element it proved to be a good marketing initiative.

Although these activities were not aimed at creating sales, but more to increase the awareness

within the market, as a result the actions were recognized and praised by the Mayer of the city.

Secondary activities

The list or support activities are as it follows: human resource management, procurement, firm

infrastructure and technology development.

Of course the most relevant out of all of these is the human resource management.

Here About Innovation is constantly acquiring new volunteers and at the moment they are

looking for more interns from various fields, such as design, and for that the focus is heading

towards the design school from Copenhagen, KEA. One of the competitors got themselves an

intern from the same school and their design had improved significantly. The main source from

which About Innovation is getting the new volunteers is through the weekly meeting

‘’AffaldsImperiet’’ where they invite new people and present them the upcoming goals for the

usage of waste for the following months so then the people can see where they can offer their

help best.

Procurement is one important aspect that had been analyzed by the owner Zenja Jorgensen in

terms of acquiring new founds for the company. Given the possibilities for better recycling

systems, Zenja managed to get the Roskilde Municipality to found her project. With great

success, founds had been given to About Innovation and now the company will therefore build

their own venue.

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Firm infrastructure is a hard topic to discuss looking from the perspective of a startup. The sales

are small and every other aspect within the company is unclear in terms of management,

accounting and financing. Recently, About Innovation decided to register their company to the

Danish Chamber of Commerce. The type of company is ‘’enkelmandsvirksomhed’’ which stands

for sole proprietorship, meaning that the only one owner is liable for everything and owns

everything.

The Business model of About Innovation at the moment

For assessing the current business model that the company is using I opted to go with the

Osterwalder business model canvas book. About Innovation is in the incipient stage of their

existence, therefore a viable business model was never created. The company had designed a

business plan and the rest of the activities were planned on the way, most of the strategies

being changed multiple times. Even though the most important blocks from the canvas model

are still indefinable and can be analyzed. A business model is never going to be the same as

time passes, the company will have to adapt to the target market ass the time to be able to

sustain a profitable business. After analyzing the documents from the company and having

discussions with the team I have managed to put together the following model.

Value proposition

The currents values that About Innovation is bringing to the customers are:

Unique products -each product it’s going to be different even if they are from the same model.

Working with recycled materials offers this possibility to each person to have their own unique

item.

Hand crafted – the customer knows that a certain person invested their time to manually make

that item and it becomes more personal.

Environmental friendly – A large majority of people are nowadays concerned of the global

warming and the effects of pollution and tend to care as much as they can.

Access to innovators network- people that see the work is being done and would like to bring

their own contribution to the waste reduction can become a member of About Innovation

,where a knowledgeable network of can nourish the ideas and make them real.

Make an impact on the waste culture- About Innovation is not only about recycling but also

about encouraging people to take a different perspective on what the societies can actually do

with the waste, is the perspective of an activist within waste culture.

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Unique events and workshops -where the company is educating companies and schools about

sustainability and innovation

Customer segments

Customer segments by size: b2b- Startup, small companies and medium size, b2b-individual

customers

By location: Copenhagen, Roskilde.

With the above mentioned segments the company is able to direct their strategies for the

development of the concept and what they can do for these segments, but later when the

management will want to develop the company it is required a more detailed portraying of the

segments so that the marketing campaigns can be directed to the right customer segments.

Channels

The channels though witch the company and their customers can communicate are at the

moment formed by social media, , website, email, calls and meetings with the public.

Customer relationships

The relationship model that About Innovation is based on it’s the transactional one for the b2c,

where the customers and the seller are in for themselves. The transactional relation does not

focus on the customer retention, but more on designing, pricing and promoting an appealing

product to the customers.

Once the company is able to conduct better projects for the b2b and be able satisfy the

customer’s needs, a relational approach will be helpful and it will reduce the cost of acquisition.

Revenue streams

The revenue stream comes from sales of products, projects, and subscriptions for the

members.

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Key resources

The most valuable is by far the human resources. As at the moment every activity is based on

the volunteers work and their skills and creativity is needed in every event or activity.

Key activities

Key activities are the regular events that are being organized throughout the city; these

activities are meant to bring more awareness to the people that About Innovation.

Other key activities are the product development where several prototypes are being made

before the actual final form is done and ready for production.

The last key activity is the weekly meeting where the agenda for the following week or more

will be presented. Here other people from outside the company can join and see how they can

contribute making out of this activity also a customer acquisition tool.

Key partnership

The key partner is INSP, established in Roskilde INSP had offered the company storage room

and access to the wood workshop as well as media workshop without any costs.

On the other side of the partnership About Innovation will have to help INSP with volunteering

work.

Cost structure

Fixed costs: the website and the hosting

Variable costs: gas for the transportation and other food expenses.

Most of the work and the materials are being used are being recycled and therefore only time is

used to gather these materials by volunteers.

About Innovation is still in its early stages and many costs structures will be there to follow

once their own venue will be established.

Competitive strategy

Michael Porter had brought to the corporatist market for the first time in 1985 the generic

strategy for competitiveness with adjustments on the way for a better applicability. The Porter’s

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generic competitive strategy3 model is shaped by two vectors, one that shows the competitive

scope and on the other hand is the source of competitive advantage. In terms of what is About

Innovation’s competitive scope, we will have to further research the other external factors.

Anyway, by looking from the internal perspective of the company we can observe that the

target market is rather narrow, only local small and medium sized companies and up cycling

enthusiasts.

The competitive advantage that About Innovation is trying to achieve is being outlined as

differentiation strategy. With the differentiation strategy, the company is looking to create

more advantages for new customers, usually better qualitative and unique where the company

can ask for higher prices.

External analysis

PESTLE

Pestle is naturally a good analysis for a company to conduct as it represents a couple of

important aspects that can offer opportunities for the companies such as the change in VAT for

certain products and that will follow in a higher revenue, but on the other hand there can be

also threatening, as for example is Uber, the Danish Government is changing the regulation on

which the people can work for Uber and this might decrease significantly their income or can

even lose the market.

We will get to analyze the Danish and the Swedish countries.

Political and Legal factors

Only the indices what will directly have effect over the activity of About Innovation will be

discussed, such as the employee law, consumer law and import export law.

In Denmark and Sweden, the employee rights are being defended by the unions. Approximately

75 % of the labor market is a member of a union in Denmark. The unions are the ones that

establish that the rules for both the employers and the employees are being according to the

contract act and in regards to the civil law tradition4. If the employer fails to respect the binding

rules they are entitled to 13 week paid salary in Denmark.5 According to the annual leave act

1997:480 there are 25 vacation days per year in Sweden as In Denmark according to the holiday

employee act-chapter 2 -Holyday entitlement. 3 Competitive advantage : creating and sustaining superior performance : with a new introduction /Michael

E.Porter /ISBN :0-7432-6087-2 4 http://www.iclg.co.uk/practice-areas/employment-and-labour-law/employment-and-labour-law-

2016/sweden#chaptercontent1 29.11.2016 5 https://www.pwc.dk/da/human-ressource/assets/pwc-brochure-labour-law-web.pdf- the employee contract act

and the Danish union system. 29.11.2016

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Consumer act in Denmark states that companies cannot contact by any means customers with

the purpose of selling them anything without them agreeing upon it6. The same statement can

be found in the Swedish consumer act 7 as part of the European Union Ombudsman practices.

Import and export is being largely supported and encouraged by the two countries. Although

there are still burdens on how to transfer capital due to the currency difference it seems that a

fair amount of 7 %8 of goods are being exported and imported between the two.

With the Oresund committee serving as an innovation hub where green companies are being

supported for further cooperation with partners from Sweden and Denmark it seems that the

cross border cooperation will nourish healthier relations. The international competitiveness and

connectives of the regions is being enhanced by Kastrup Airport, it offers excellent links in both

directions. The committee activities are mainly financed by the Danish state Danish pension

fund and the EU infrastructure founds.

Taking a step backwards to observe what is the political infringement of the European Union

over the national playground and we can see that the European Commission had put together a

plan for what is called Circular economy 9 and its purpose is to bring a sustainability approach to

companies and to the overall process of production, consumption and disposal of the products.

The EU had put together also a program called INNEON10 that stands for network for eco

investment. The purpose of the program is to identify, support and coach eco-innovations

entrepreneurs, SEMs to reach investor readiness.

Economic factors

The GDP growth rate in Denmark for the last year is being slowly growing with a 0,4 % lower

than the previous year, specifically 2014 with 0,3%11.Unlike in Sweden where the GDP is higher

0,5 with only a small change since 2014 of 0,1%12. The country’s GDP shows what is the

financial viability of the country and how healthy is the economy overall. Given the fact that

Sweden has higher GDP is more likely that they are more willing to spend.

6

http://www.consumerombudsman.dk/~/media/Consumerombudsman/dco/Markedsfoeringsloven%20lbkg%202013.pdf 29.11.2016 7

http://www.consumerombudsman.dk/~/media/Consumerombudsman/dco/Markedsfoeringsloven%20lbkg%202013.pdf 29.11.2016 8 http://www.centreonconstitutionalchange.ac.uk/sites/default/files/papers/Spotlight%20on%20borders_Sweden-

Denmark_FINAL.pdf- page 3 29.11.2016 9 http://ec.europa.eu/environment/circular-economy/ 02.12.2016

10 http://ec.europa.eu/environment/circular-

economy/pdf/seminar/6%20INNEON%20presentation%20(Aitor%20Garro).pdf 02.12.2016 11

http://www.tradingeconomics.com/denmark/gdp 29.11.2016 12

http://www.tradingeconomics.com/sweden/gdp 29.11.2016

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The Danish KR shows stability over the last fiscal year with a parity of 1, 31 Swedish kr for 1

Danish kr. The fluctuations of the currencies it is given by the lower exchange rate from 1

January 2016 that was of 1, 2413 SEK for 1 DKK.

According to the better life index OECD14 it seems that the household disposable income in

Denmark has an average of 189 355 DKK/year with a middle class of 60 % of the labor market.

On the contrary, in Sweden the household disposable income stands for 202 806 DKK/year

having similar middle class representations.

According to the reports from Statistics Denmark it seems that the unemployment rate in 2016

is raging between 4, 3% in July and 4, 2 % in late September. The unemployment rate had fell in

Sweden compared to the previous year from 6, 7 %15 to 6,3% , having at the moment 4933

persons employed. In what concerns the skilled employees, both in Denmark and Sweden there

is a high rate of literacy and with professional schools such as HX is easy to find skilled

employees.

Social factors

Denmark is a fairly small country and according to World bank database, the population is 5,6

mil. The social welfare in Denmark is free therefore it is likely that people can get better

education and become more skilled, Sweden has similar welfare system. Also it is known that

students that are about to finish the education program have to consider going to an internship

to complete their education.

The same internship infrastructure can be found also for the unemployed both in Denmark and

Sweden. The safety net for the unemployed it is assured by the unions they are being part of.

The job centers provide the people with courses and with opportunities to go for one month

internship in companies and get more skilled, with all the costs covered by the Danish

government.

Looking at the trends, and we can observe that the Danish and Swedish culture is having great

interest in recycling and waste reduction. A multitude of companies help mainly with the reuse

of carton, glass, and plastic. The reduction of waste is also encouraged by the pant system

where people that buy bottles already pay for the package extra 1, 1, 5, or 3 KR, this represents

interest for other people also.

On the other hand, in Denmark, especially Roskilde we can observe that the trend is in

contradiction. At the Roskilde Festival there are approximately 120 000 people attending and

the amount of trash left at the site after the event can be big. Organizations take care of the

13

https://www.tradingview.com/chart/?symbol=FX_IDC:DKKSEK 29.11.2016 14

http://www.oecdbetterlifeindex.org/countries/denmark/ 29.11.2016 15

http://www.tradingeconomics.com/sweden/unemployment-rate.29.11.2016

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trash during the event and after but the selection of trash is not consistent. The trash can be

only used for burning.

Technological factors

It is common that the Danish Government is supporting the initiative that shows interest in

waste reuse. With a business plan and realistic vision people can get founded for their ideas.

Most certainly the present solutions for recycling are nonetheless efficient, with better

technologies; recycling plants can shred and select wood, iron with the help of magnets, and

plastic with air pulsations. For example for a tone of glass at a recycling plant can only have 25

grams of impurities.

Porte 5 Forces

To understand how to better compete within the market we first have to understand the

industry. Understanding the industry will further reduce the company’s uncertainty towards the

treats of suppliers, buyers, substitutes, rivalry and new entrants.

Supplier power

About Innovation had been relying on the resources they have collected from the Roskilde Festival from

2016 to conduct their events. The festival is an important supplier as they allow the company to take as

much trash as they want. The collected materials represent an important source of raw materials and if

the Festival will not allow the company to collect anymore they have to find alternatives. Fortunately, in

Roskilde there is a waste center where plenty of discarded materials such as household waste are being

delivered every year. In what concerns the wood is being used for the furniture, there are lots of

suppliers of pallets what are not wanted, such as pizzeria or schools.

The supplier power is medium.

Buyer power

The chances are that the products of About Innovation can be substituted as there are some other

providers on the market, some of them are even more skilled. Although they serve the same market, up

cycling and recycled products, they have slightly improved design. Within the events and workshops

market it is being known of other people having such events, for example ‘’remake Christmas’’ in

Copenhagen. The only difference is the geographical location; About Innovation is operating in Roskilde.

Buying power of the customers is being assessed as being medium.

Treat of substitutes

Substitutes for About Innovation are considered as the furniture producers, such as Bolia, Ikea, Jysk

which are specialized and can have a better offering. For the rest of the things that About Innovation can

offer, their creative workshops and the sustainability events, it is not quite sure who are the other

people competing with them except on person that is in Copenhagen.

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If we look at the product substitute treat, then we have a high treat, but on the other side from the

events perspective is the treat is medium.

Threat of new entry

The recycling industry in Denmark is very developed. With outstanding methods on waste selection and

usage we therefore have the largest companies that work with the landfill recycling where complex

systems of recycling are being used. Carton, plastic, metal , glass is being reused into new products

where the rest of the materials go to the local power plants where they are being burned and the

energy is being used to heat water for the city.

The indicators for a high or low treat of new entry are being represented by the investment capital

required to start the business. In the case if About Innovation, the capital required to start the business

is low, they have not invested almost any money until the present time, we therefore can consider that

it is the same for the other companies willing to access the market. The technology it is not complex,

wood working machineries, saws and other common tools can be easily purchased by any company. In

what concerns the production materials, clearly there are few places from which the companies can get

the resources such as Roskilde festival, here they can get bulk materials, and also other individual

suppliers that are not hard to find.

Alternatively, the distribution channels present a burden when it comes to recycled materials, as long as

the materials and not being the same and therefore the products are unique, it is quite difficult for the

companies to get their products to distributors as they require standardized products.

Clearly the barriers of entry are not high and the treat of new entrants is high which means that the

market share can be easily minimized by the new comers and therefore the present market player have

to stay aware that they have to constantly change their competitiveness strategy.

Competitor analysis for the Danish and the Swedish market

In order to conclude the essentials about the competitors a competition analysis and benchmarking will

be conducted within the Swedish and Danish market.

The companies that are directly competing with About Innovation are the ones that are involved in up

cycling, or in other words reusing the old materials into new products. Such companies offer similar

product range such as chairs and pillows, also slightly different ones such as glass products.

For the Danish Market I have identified 2 main competitors: Bevar16 and CanAltRedesign17.

After having a look over their website, clearly we can see that Bevar is specialized in the manufacturing

of products such as bags, pillows and cushion chairs out of old denim. Their main target market is the

people that are enthusiastic about such products and are also a little price sensitive.

16

http://bevar.dk/ 30.11.2016 17

http://canaltredesign.dk/ 30.11.2016

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On the other end we have CanAltRedesign, serving b2b and as well b2c. Their main activity is based on

using industrial leftovers from factories. With similar product as Bevar, CanAltRedesign is manufacturing

fashionable aprons for restaurants and for the b2c they create bags and clothing articles. They also have

an eye on design, as it is obvious their products are more fashioned.

Searching the web, mainly Google by typing key words, such as up cycling, workshop, recycling, I

identified two competitors within the up cycling market. The first one is named Recreatedesign18.This

competitor vision is to extend the lifespan of materials around. To put it differently, it means that

different projects can emerge once they find the right materials. So far they have created a range of

lamps and drawers and constantly they work with interior design as well as a project.

The last competitor is named Hauge Glas19 and they mainly produce new glass products such as cups,

and high wine glass. The materials used are old glass bottles, as for example Jonny walker of Corona.

Their offering consists of individual customers but also companies, as they can customize the glasses

with infused company logos or hand graving for a more expensive product.

After the initial description of the above competitors, I have reached a conclusion that only two of the

competitors both in Denmark and Sweden are worth comparing to as they are the closest to the activity,

products of About Innovation. The first one that is established in Denmark is CanAltRedesign and they

are more fashionable, therefore more skilled and serve the same type of customers, also they have

access to more resources from the industrial sites.

Competitor analysis for CanAltRedesign and Recreatedesign.

Competitor analysis for CanAltRedesign

- Profile of the competitor20

- humanitarian profile: helping unemployed to get more skills

- focused on CSR

- creating unique products handmade

- open to crowed founding

- Collaborates with Berendsen Textile in Holbaek and Vig festival.

- Colaborates with KEA for product deisgn

- Sells both to the b2b and the b2c

- Headquarter in Nykoebing

Competitive advantage of the company

Having the fact that partners such as Berendsen offers them raw materials is important as the company

do not have to search for these materials which is time-consuming and also the type of materials found

might not be the same. Having a stable inbound of colors also makes it easy to produce series of

products not just one piece.

18

http://recreatedesigncompany.com/ 30.11.2016 19

http://www.glasweb.se/hauge/beta2/default.asp?lang=sv&content=welcome 30.11.2016 20

http://canaltredesign.dk/ 30.11.2016

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Another competitive advantage is that the company collaborates with the design school KEA and

therefore their design is more valuable for the customers.

Target market

- Restaurants

- Individuals interested in up cycling and alternative clothing

Marketing strategies

- Invests in their brand, they are present in the press21 and also held an optimized site that shows

professionalism.

- They have key partners ,as I mentioned earlier- Berendsen22

- Creates awareness by updating their activity and writing articles23

- Targets CSR activities24

- Involved in the community development , training unemployed and refugees25

Products

- The products 26are being created as singular projects or as batches. Alternatively products are

being created with the help of students of design school KEA.

- The company is producing a range of fashion bags that are made from canvas material and the

colors can vary from Blue, white or dark blue. For the restaurant side they provide aprons and

knife holders.

Pricing

- For the Apron we have a price of 300to 499 DKK and for the bags 250 Dkk

Cannels

- The sale does not take place on their website, but clearly prices are being displayed on the

Facebook page. Accordingly, customers can contact them and get more info about a particular

product.

- The promotion is made through the website where they promote their initiatives by posting

press releases, and the upcoming ideas. Other channels for promotion are Facebook.

- Other promotion is being made by attending events that have as focal theme sustainability and

ethical CSR activities.

Competitor analysis of Recreatedesign

Company profile

1. Headquarters in Gothenburg

2. Operating on multiple markets

21

http://canaltredesign.dk/wp-content/uploads/2016/05/CanAlt-artikel.jpg 30.11.2016 22

http://canaltredesign.dk/om-canalt/ 30.11.2016 23

http://canaltredesign.dk/presseomtale/ 30.11.2016 24

http://canaltredesign.dk/om-canalt/ 30.11.2016 25

http://canaltredesign.dk/om-canalt/ 30.11.2016 26

https://www.facebook.com/CanAltRedesign/?fref=ts 30.11.2016

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3. Possess innovative human resources

4. Areas of interest: lifestyle, design , recycling/up-cycling

Competitive advantage

Recreate design offers a variety of services for businesses that represents more value; on the other hand

they have a good knowledge of the market and have high innovation and creativity standards. A key

competitive advantage is their human resources that can deliver unique projects both for companies

and private persons.

Target market

1. B2B, basically every company can use the services offered for the interior design

2. B2C –people interested in non-conformist interior furniture

3. B2G- social welfare people bring money from the Swedish government and get training

Marketing strategies

Invests in design and also execution

Present on a broad line of social media channels

Fosters networking through the share space program and innovation hub.

Positioning -design and stylish, sustainable.

Knowledgeable of their strengths

Diversification-serving many customer segments

Product and service profile

- Interior design for companies and households27

- Inventory relocation –takes care of the old furniture companies don’t need any more and places

them at schools or reuse them into new products.28

- Creative workshops 29- team building purposes and educating school students towards

sustainable future.

- Consulting service30- with focus on guest speaking , project management , event planning and

sustainability

- Studio share31- sharing the working place with other companies to foster innovation and save up

costs

- Social enterprise32- unemployment is a concern therefore people are getting more skilled within

creativity and innovation.

27

http://recreatedesigncompany.com/services-2/sustainable-interiors/ 30.11.2016 28

http://recreatedesigncompany.com/services-2/inventory-relocation/ 30.11.2016 29

http://recreatedesigncompany.com/services-2/creative-workshops-2/ 30.11.2016 30

http://recreatedesigncompany.com/services-2/consulting-services/ 30.11.2016 31

http://recreatedesigncompany.com/services-2/studio-share/ 30.11.2016 32

http://recreatedesigncompany.com/services-2/social-enterprise/ 30.11.2016

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Pricing

After screening the website and taking a look on their social pages I could not be able to find a price for

any of their products. I therefore sent them an email requesting a pricelist for some of their products

and services. No answer had been replied.

An estimate would be that their prices are more than the other competitor’s offerings, as the design is

more stylish.

Channels

Facebook, Instagram, Pinterest, twiter, Google +, LinkedIn.

Benchmarking The benchmarking analysis will help us identify the core competences of About Innovation in report to

its competitors. By doing so we will be able to stand out in the market and compete.

Redesigncenter and CanAltRedesign are the ones that have similar offerings to About Innovation. By

looking at the Swedish competitor we can observe that they are more focused on the redesign of the

workspaces for organizations. Despite the fact that we are not aware of the price range for these

services I still consider that About Innovation has an upper hand. As a start-up they cannot ask for high

prices before they build a customer base. Furthermore, later they can have references and referrals.

CanAltRedesign is working with fabrics from industrial plants and are focused mainly on manufacturing

clothing witch is minimizing their product range. About Innovation already is experienced with working

with wood, textiles, lamps and have a broader product range. In this way it becomes easier for the

customers to find the right mix of products and services at the same place and even get bulk discounts.

Key features of About Innovation

1. Combining wood craftsmanship with recycled wood and likewise for textiles. With two

enthusiastic people the company already managed to product several furniture pieces

2. Designing creative workshops for the public. Already at their thirds attempt and the progress

can be seen in the remuneration. Remake Christmas brought the company small revenue and

more than that the people can see the intentions of the company and start trusting them.

3. Designing projects for the organizations. Although at the beginning in this area it seems that

companies are interested in cooperating in projects. This shows potential for relational

customers that are more valuable on the long run.

4. Training unemployed people. Knowing the governmental opportunities from the PEST analysis it

is clearly that the company will gain revenue from this customer segment.

5. Offering memberships for people to create their own projects. With the weekly meeting where

the company is presenting their intentions and progress more people are interested in joining

in. They can either join as volunteers or as members where they design their own projects by

paying a small annual fee.

How About Innovation will be able to support their key features on the future

Attract wood artists in joint projects to help the employees get more skilled

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Design bigger projects for the city that can be seen by everyone not just within the pale of the

workshops. In this way they can get the recognition of the whole city.

Seek for volunteers from the design school KEA, or other alike that can bring a design

perspective to the projects that can be more valuable.

When it comes to teach people the communication is an important factor, the people have to

feel comfortable and confident that they can and are doing the right things. About this the

company can set up a motivation scheme to support continuous practice.

Communicating freely with the new people will make them understand what is that they can

benefit from the other members. A set of teambuilding exercises would be useful.

SWOT

SWOT comes to recapitulate what are the main highlights of the internal side of the company

and in equal measure the external treats and opportunities that arise after completion of the

microenvironment analysis.

Strengths and weaknesses of About Innovation

The assessment of the strengths and weaknesses it is important as these factors also will

contribute at the development of growth strategies. Using some of the strengths will lead to building

competitive advantage for example. On the other hand, being aware of the weaknesses will help About

Innovation understand why other competitors are going to be better.

The following table contains broadly the set of strengths and weaknesses that are the most important

for the company to be able to move further with the concept they envision at the moment.

Strengths Weaknesses

Human resources availability (Volunteers) Founding Resources Machineries Warehouse Employee communication Creativity High CSR profile Employee motivation Low conflicts Unique products Income opportunities from unemployment founds from the state

Weak design Lack of stable vision Weak management Low awareness to the market Low revenue Low capital No customer base Low workers skills

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Treats and opportunities

The treats and opportunities are the result of other companies, governments actions and they cannot be

changed, but only be observed and sometimes avoided.

Treats Opportunities

Up cycling is gaining more interest for entrepreneurs Low interest on the customers side in up-cycled products Globalization

Danish government is investing in training the unemployed Roskilde Festival waste INNEON founding program Circular economy rises awareness Opening a coffee shop and showroom

Part conclusion for the external analysis So far we have been assessing the potential of countries, Denmark and Sweden .In report to the

literature and the internal objections of About Innovation we see that Denmark has a high spending

power, although less than the one on Sweden.

Moreover, the import and export between the two countries is being increased once the Oresund

Bridge had been opened meaning that now it will be easier for the company to distribute over the

borders. Thinking consciously about the governments in both countries regarding the employment

trainings we can say that it’s an opportunity for stable income once the organization is established.

Great emphasis is being shown for the circular economy coming from the European Commission, with

time About Innovation will become clear on what is that they can offer and with a viable business model

they can access the founds offered by Angel investors.

Turning our attention to the porter 5 forces analysis and we identify a high treat coming from the new

entrants, more to be aware of is also the treat of substitutes, some of the competitors are more skilled,

stronger brands ,and have better suppliers.

Naturally, we can deduct that the closest competitors are more stylish and hold better human

resources. They also have a better understanding of the industry and are better embedded within the

markets with already established distribution channels and customer base.

Once the internal and external analysis it is completed, for the following part of the paper I will put

together an implementation plan

Implementation plan

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In the implementation plan I will combine the following set of theories and models to ensure the good

development of the company for the future two years.

To start with, the Ansoff Growth strategy will be outlined to better understand how to position About

Innovation in regards to its competitors. Ideally it will be that the markets where the company is

heading to are free, or few competitors. For this I will use the blue ocean strategy that should lead the

company to a new market demand with prospects of a high market share. While these new strategies

will fall in place, the actual business model will change as well and an updated one needs to be created

to ensure the viability if the value proposition.

Moving to the marketing and the sales plan for the home market and the international one I will show

the importance of customer relational strategy. This strategy will bring new customers in time due to

the qualities of referral and reference.

To complete the implementation plan I will make a budget for the following two years and as well a

balance score cards with measurable KPI’S for planning and purpose so that the company can monitor

the progress.

Ansoff Growth Matrix As from the next year About Innovation will hold their own workshop where they can create most of

the products. Knowing this and the will of the management to quickly grow I can see that the most

suitable strategy it is the market penetration, already the company had made some small sales but more

people are being interested in their services and merchandise. Accordingly, About Innovation will have

to boost their presence in the market, make more efforts with advertising and promoting their products.

Naturally, all of the above will have to be included into the marketing plan so it will support the sales as

well. One of the advantages here is that the quality of the products is better and it’s also friendlier to the

environment and unique. These value propositions will act as a competitive advantage against the

competition.

The market penetration strategy is being shaped by the following the following directions:

It should be attracting customers that have small and medium organizations, such as cafes and

restaurants that do not have a fresh look in their venues. By having changed the interior the customers

will prefer to come and eat or study and it will be anyway an improvement for them. To be able to

actually get the sales it is important that we will manage to have many leads. Once we have enough

leads the next step is to convert these leads into sales.

On the other hand it will be a good opportunity to market the products to the b2c as well, in a manner

that will make them chose our products over the other designers and big retailers. For this strategy we

have to understand very well what tools use the competition to attract their customers , what offers do

they have, promotions, how do they present the products and in equal measure what is that the

customers look for when they want a new product.

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The main reason of the penetration strategy is to gain market share for the About Innovation, of course

that now we have outlined the directions where the company is going to and also highlighted the values

that they will compete with it. At the moment it is important that the company will also invest in the

personal selling as now the sales person is the first that comes in direct contact with the potential

customers and it is vital that this first contact is a going to create a good image into the customer’s eyes.

Internalization strategy

Stay at home and Born Global –two step strategy

Given that fact that globalization is becoming a more discussed subject nowadays that shapes most of

the world economy among the implications of the states, it is important for any company to have

analyzed this perspective once they are willing to bring a product or service to the market.

As it is said by Peter Dicken in his fourth edition ‘’Global shift’’33 , ‘’any market that is global is also

local’’. Therefore it is important for any company once they start their activities on the local market but

to have in mind the potential for global expansion.

The criticism for the born global model in the case of About Innovation is that this model requires first a

high degree of capital and a strong network that will allow the company to expand at fast rate in

multiple markets at the same time right before the competition does. On the other hand it is equally

important that the management vision it is of great stance and it’s able to take the concept further.

At the moment About Innovation does not held any of the above mentioned factors except that the

drive of the management is envisioning a bigger picture for the world circular economy 34

As it was noticed also in the political findings in PESTEL, a greater accent is put on this concept by the

European commission with possibility for founding as well.

As it was mentioned also in the conclusion of the external analysis, once the company has a viable

business model it is more likely to be able to go global or at least first on the European continent. Until

that point the company needs to be stable and have well established value chain and a supply chain that

is minimal functional.

What I mean by minimal functional is that all the systems are working with minimum of resources

involved. It is more like a prototype or even a pretotype. Theories that can help with this tasks are for

example the ‘’Mechanical Turk’’35, which is an entrepreneurial tool to try out theories for a functional

concept with investing as minimum resources as possible.

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Another internalization theory according to the nine strategic windows36 is the safest and it requires the

company to stay at home. By doing so About Innovation will prepare with the right business model, get

the right connections and gain capital for cofounding.

Blue Ocean strategy Within the today’s business environment it is obvious that multiple markets re being saturated and

competition is battling for market share in a shrinking market. The solution comes from W.Chan and Ren

E. Mauborgne as what is called the blue ocean strategy and it stands for creating a new market where

the competition is irrelevant.

The blue ocean strategy is relatively looking at creating a better, more innovative value proposition for

an untapped market that can cover demands of the customers that have never been addressed before.

Strategy canvas

With the strategy canvas, strategies of the competition are being compared across several categories as

it can be seen in appendix 5.

To be able to efficiently position the company in such a way that it will not directly compete with the

other two by product, price, or any of the above characteristics, as much as possible we will try to

eliminate, raise, reduce and create new values for a perfect competition.

Four action framework

Eliminate Waste processing as the only attraction

Raise Atmosphere, quality, personality , authenticity

Reduce Number of public events. Get fewer but with greater impact across people and time.

Create Education events and workshops on sustainability and innovation with companies and schools Coffee shop with showroom of up cycled products

One things that is worth to keep in mind when creating a strategy for blue competition is that no matter

how much the company will align themselves for a niche market, there will always be other competitors

either copying your business model or naturally reach the same market. That is why it is important to

constantly reshape the strategy and reposition.

Business model to be The business Model will aim at describing the value adding process for the customers.

The fundamental stage in creating a profitable business model is to start with a good value proposition.

If the value proposition is the core of the business model, we will aim at creating a strong VP so then the

rest of the blocks will come to support those.

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For a proper design of the business model, a clear view point upon the pains and demands coming from

the potential customer perspective will have to be assessed. In this way About Innovation will be able to

deliver the right values.

Furthermore, I attempted to conduct a small qualitative research with the school ZIBAT, where I have

presented the idea of a practical workshop that can help with the students understanding of topics such

as sustainability and creativity in a more interactive way.

Presenting the service would lead me to the reactions of the teachers to such an initiative, and it will

help me understand the future success of the workshop.

According to the Business models Canvas book we have to address the right questions for a creating a

meaningful value proposition. The sum up of these questions is being covered by what is called the

empathy map.

In this way I have approached the issues that arise with the students regarding the present teaching

methods; here I tried to analyze the pains37.

Accordingly, by putting myself into the customer shoes I have identified the following pains:

Lack of trust that someone else might do the right job and they tend to do everything by

themselves

Lack of investment capital

Lack of communication skills between the employer and the employees

Low vision and innovation skills

Fear about employees that they are not going to bring the right solutions to the problem in

course

Lack of trust in the outcome of the service

High uncertainty

Value proposition

After reshaping the competitive strategy in the Blue Ocean strategy, some of the value propositions had

been left aside and other have been more emphasized so that the company will be able to reach

another market that will be profitable.

Grounding the creativity and Innovation for companies through involving projects that

stimulates the employee’s ability to express.

Prolong life of waste through alternative design

Creating long-lasting design for the companies where both customers and employees can feel

comfortable and inspired.

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Customer segments

Having in mind the new information acquired from the analysis of the competitors and what is being

outlined in the blue ocean strategy it is beneficial if a new assessment of the customers segments will be

made.

Segmentation by size: startups and small and medium companies

By location: all around the Copenhagen area within the reach of the company’s possibilities to transport

the right resources for the projects.

By industry: Even if the services offered are not necessary bounded to a specific industry, anyway we will

have to be more specific on what is closer to become a future customer. We have identified in our

competitor analysis that Redesign center is offering their services to basically every company that is

looking for relocation or redesigning their workspaces. Also we offer services concerning creativity and

innovation that all companies can use. Therefore the industries we will be targeting should have

multiple workspaces or areas where customers are sitting. Furthermore, industries such as Hospitality

and Tourism, Education industry (schools) and Retail are the targeted ones.

By needs: Making the empathy map of the pains that the customers might encounter, the following step

is to create symmetry by uncovering the needs.

Need for a fresh perspective for the employees that will stimulate new ideas and better progress.

Need for a competent supplier that is able to bring fresh design with a good balance price/quality for

the workspace and public space.

Need of competent people to guide and foster innovation and creativity among employees

Customer relationships

With customer relationships it can only go within the following directions, referrals, and reference and

co creation. It is more than crucial for About Innovation’s development that they quickly generate

referral relationships as it will be easier for future customers to get firsthand information and guidance

from the consumer itself. Moreover referrals represent one of the informing sources of any customers.

On the other hand we have the Co-creation. It is equally important for the company to be able to

develop their design and skills; with co-creation this will be easier by using the client’s suggestions.

Channels

Different channels will serve different needs. To be more specific, we therefore have:

Channels where the company is creating awareness and keeps the public engaged and updated with

what are the projects they are being working with, such channels are the social media: Facebook,

Instagram, personal contact with the public and maybe for a more professional approach designed to

create a better network, LinkedIn. As I mentioned in the internalization strategy, About Innovation will

have to create strong connections.

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Sales, the company will have their own website with the beginning of February next year; another sales

channel will be through sales people.

For customer support or any inquiries, the clients can contact the company via e-mail.

Revenue streams

1. The revenue streams will not change significantly, the streams are as it follows

2. From members subscription

3. From direct sales of products

4. From projects for companies for interior design

5. From projects on innovation and creativity with companies and schools (educational )

Key resources

The most important of all resources that will be needed are the human resources. The company will

have to have skilled people to be able to understand the customer’s demands and also be able to

conduct a good project execution that will be referred to other companies.

Key activities

By far one of the most important key activities will be the continuous education of the volunteers and

the employees. In this way they can develop better and more valuable projects. Also investing in the

research and development it will be important, as they will always have to bring up new design, new

products and exercises for fostering creation and innovation.

Key partners

As from the next year the company will have their own venue, therefore their partnership with INSP will

not be needed, in this case there is not any important partner that the company cannot function

without. Nonetheless, on the future, maybe it will be good for the company to partner with schools,

designers, and environmental protection agencies, so in this way they can develop their products better

and also get the recognition and credibility for their services and products.

Cost structure

The cost structure will be changed one the company will open their new venue and start their

operations on a larger scale, therefore I have put together an estimate of the yearly income and

expenses in a budget 38for the following two years, 2017 and 2018. Naturally this can change due to the

external circumstances.

Budget When About Innovation started to exist as a business entity, there were almost no expenses. Most of

the materials used for the creation of workshops and the products themselves had been obtained from

free resources and the time of partners. Naturally, there have been no salaries paid to the apartments

as they intended not to have any employees until the company is constantly wining profits. Other

materials used and as well the storage room were all for free offered by INSP Roskilde. Gradually the

38

Appendix 1

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company’s activities had ben extending but all with the help of volunteers, and the same concept it is

preferred for the time that is up to come until the company will be self-sustainable. Most of the times,

the members will spend from their own pockets for food and to cover other necessities.

One of the biggest expenses that the company will overcome it is the purchasing of containers to build

the new venue and as well the right machineries so that the staff will be able to perform their work in

favorable conditions, such as electrical saw, drills with different endings, gloves and other machineries.

With the opening of the venue, the about innovation plans to have a small coffee shop that could bring

them more revenue that is stable. Moreover, costs for separate machineries are also considered, such

as coffee machine, fridge and glass display. To continue with, one part time person will have to be

employed in the next year to take care of the sales.

So far the company managed to successfully get other’s people interest and as well institutions

showed great concern in what About Innovation is aiming at. Furthermore, as a source of income,

founding seems a good strategy. Applying for founds worked before and they got help from the Roskilde

municipality and in equal measure they also won a competition. For the future income, they can still

pursue the same strategy but also increase the sales of products and paid workshops. For the year to

come the company can go to other competition and apply for founds again, subsequently they might

win 100 000 dkk. As it had been concluded in the growth matrix, a market penetration will offer them a

part of the market share and subsequently it will lead to sales.

The company at the moment has to offer two services. Interior design service will be paid according to

the size of the venue, to the complexity of the project and resources used. Accordingly, a specific price

cannot be established but an estimate between 2000 dkk and 5000 dkk should be a feasible price.

During the year the company might take somewhere between 2-5 projects.

The second service that stand for the creativity and innovation workshop for companies and schools will

range between 1000 dkk and 2000 dkk with the resources given by About Innovatinon. Having in mind

the time it will be used for preparation for the activities, two workshops for the first year is a good start.

Nonetheless, we have the sales of About Innovation products, such as benches that are priced at the

moment with 5000 dkk each, and pillows having a price of 350 dkk. An estimate of 10 customers for the

next year would be a good reference to start with.

The café it is not yet ready and a realistic estimate is hard to be made, but 2000 dkk a year it should be

possible.

Lastly, by acquiring new members, unemployed and the company will get money from the government

for training them, or as people that are just passionate about wood and do it yourself projects, About

Innovation can win an estimate of 5000 dkk/ year.

By adding together the assumptions we have:

3 interior design projects -9000 dkk

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2 workshops -3000 dkk

10 sales > (1 bench =5000 dkk) + (5 pillows= 1750 dkk ) = 6750 dkk

café =2 000 dkk

from memberships -5000 dkk

For the first year, 2017 it seems that About Innovation will be able to generate 24750 dkk from all of

their customer segments. Gradually, it is normal that the sales figures will increase for the following

year, 2018 and a rise in revenue will be noticed. It is more of a must for the company to pursue a and

gain more customers as the costs for opening the new venue will exceed their investment levels and

therefore they have to break even as short as possible. It is estimated that a rise in sales for 2018 will be

of 10% more.

There does not seem to be much of a profit, but for a startup company that is still figuring things out,

this is a proof of their abilities and naturally they will grow more and be able to deliver more qualitative

and valuable services and products that can be prices accordingly.

Below I have comprised an in depth budget to the following two years that can be seen in Appendix 2.

Marketing plan With the creation of the marketing plan About Innovation will try to determine where it will be their

position within the market, what comprises their vision in what concerns the marketing itself and the

objectives.

Positioning

Reborn resources are uniquely combined through creative design. Redesign workspaces for companies

and rediscover aptitudes for and for their employees.

Customer analysis

Most of the companies targeted are aware of the importance of a good ambient environment for their

customers as that factor alone can make great difference in their sales, customer relations.

Companies that cannot find their way to more growth are frustrated and it would be a good opportunity

for them to get around new solutions and try out new things.

The objectives of the marketing plan

Create brand awareness where the company’s intentions and skills are identified as creators, innovators

that can easily help people and organizations bring their ideas to life also.

To help the prospect customers’ uncertainty and avoidance decrease it is helpful if the company will put

together a customer portfolio.

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Get feedback from customers to be able to improve faster and develop more suitable products and as

well avoid mistakes on the future.

To promote the company’s services as new and communicate simply the fact that though their actions

and the customer’s actions, the environment is more sustainable.

Vision of the marketing

The aim of the company is to become one of the most capable innovation centers in Denmark and

Sweden that can deliver quality projects for indoor and outdoor areas, all made from recycled materials.

Their aim will be also to be able to encourage the people around to be more creative and start working

on their own ideas for the greater good of the word around, either working with recycled materials or

not.

Mission of the marketing plan

About Innovation should use money to invest in informing the public about their services and products,

according to the growth matrix, it is more than a must. The efficiency of the methods used can be

measured by the website visits, by the shares they will get on Facebook and likes on other social media

such as Instagram. The goal of the plan is to acquire at least 10 customers for the following year.

The ideal customer image

The ideal customer is the customer that is curious and is experiencing new things with their company

and privately and it’s willing to invest in the development of the company and his workers because they

know that happy workers bring more money. Ideally, the customer has more venues and it is willing to

implement the project in multiple places. At last, the ideal customer is willing to trust and is putting

emphasis on quality despite the price.

The price that the ideal customer is willing to pay it is 5000 DKK for one time project.

For the ideal customer to reach About Innovation, there should be established a lead generation plan.

Advertising

About Innovation already is accustomed to the press, many times they had been cited in articles for

their progress for winning the competition and when they opened the company officially, therefore this

strategy should be pursued in the future as well.

Public relations

Assessing the competitors benchmarking gave us the information about Bevar that they are posting on

their website new information about their initiative and progress, such behavior could be used also by

About Innovation where they can post the anatomy of their projects, what materials have been used,

where they come from, how the staff would use them and so on. It will be more to create a so called fan

community where the followers can also put questions and suggest certain projects.

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Lead conversion

For every customer that comes in contact with the company, a copy of the product portfolio will be sent

to them, in this way he or she will get the chance to see for themselves the quality and design the

company is capable of. Furthermore, the customers that show interest will get a meeting with one of

the sale persons. Once the meeting is in place, an assessment of the project will be done and a price will

be determined. If the client does not have the money to invest, maybe payment schemes should be

discussed. In any case, as sign of good faith and interest for future collaborations as well the company

can leave them a small gift as sign of their interest.

Sales forecast

As it was mentioned above, the sales that are expected to concretize are 10 sales. It is the responsibility

of every member to spread the word and encourage more people to purchase. In this way, if more

people are involved the sales can exceed the forecasted amount.

Budget for the marketing plan

Most of the expenses that the company will incur while implementing the suggestions will be

determined by the time that the employees will invest in creating advertising material and

communicating on social media the vision and mission of the company.

Key performance indicators for the marketing program

Measurable and controllable kpi’s will be used also to comprise the balance scorecard that will stand as

the backbone of a successful strategy. The following are the marketing indices:

Leads

Converted leads

Public relation mentions

Positive feedback from the clients

Marketing mix Marketing mix will allow the company to implement the steps outlined earlier in the marketing plan and

in equal measure to help the sales strategy.

Product

The products that customers are getting are finished projects for their workspaces, practical creativity

and innovation workshops and as well the line of singular items or batches.

The main characteristic that bounds the whole products it will be the design and the uniqueness of the

resources used. The customers will use the products as home furniture as what concerns the b2c and for

the b2b, the projects will serve the customers as a mean to make the consumers more comfortable

when they are waiting to have a meeting or just simply enjoying their coffee or meal. The name for the

products as for the pillows it is Millow and it stands for morphing pillow. It is a catchy name through the

warmth of the word and ease to spell it. In terms of features, the pillow has a unique design with three

corners that is meant to hold the consumers back more efficiently when they are sitting, fact that will

assure more comfort. As for the indoor and outdoor projects, the consumers will not directly be able to

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use it but just be influenced by it and get a good feeling. Moving further to the workshops, there is no

specific way to use creativity and innovation, it is up to their own imagination and creativity to take the

best out of it, of course with the help of the team directing the workshop.

Price

The prices that are being outlined earlier in the marketing plan are not to be static; naturally the prices

will have to change for meeting the customers’ possibility of payment as well. Given the fact that About

Innovation is a startup company and their recognition on the market is limited to several sales and the

promotion in the newspapers, it is wise to be able to adjust.

The prices anyway will be constructed based on what are the competitors providing , the time and the

complexity of the project and as well the possible benefits that the customer can offer on top of the

sale, as for example if the customer will refer the company to other customers.

We have estimated an average price for an interior design project of being somewhere between 2000

and 5000 dkk, but given the fact that actual designers have a starting price for projects either is big or

small of 20 000 dkk39 it will be good if the starting price for a project it will be 10 000 dkk. Of course the

price will be further be negotiated and a BATNA40 will therefore be 7000 dkk.

As for the workshops we are not aware of who are the other competitors offering similar services, in this

case we can test what is a good price again by applying BATNA. If initially we set up the price for 3000

dkk as maximum limit, a new price would be of 5000 dkk with an agreeable deal of 3000 dkk for one

workshop.

The price for the pillows and benches did not attract any sale yet, also due to the lack of knowledge of

the potential customers. If we consider the time and the resources used we can still keep the same

prices of 5000 dkk for benches and for the pillows we can raise the price to 450 dkk.

We have chosen to use penetration strategy so the prices will change again until we will be able to sell

the products and services, but still hold acceptable marginal profits.

Place

With the place we refer to all the possibilities for customers to purchase the products and services. In

this way, on the website that it is going to be created the following year customers can purchase via

online shop. Also when the new venue will be established, customers can come and visit the showroom

and also purchase the displayed products. For a greater accessibility, via social media, the website can

be mentioned in articles. Once the company will have done several projects, they can agree with the

customers to place informational material such as leaflets about the project and as well referring links to

the company.

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Promotion

So far About Innovation conducted a series of workshops in the city center where many people got the

chance to see their work. In the same manner they can work with the city development and build a

piece of art that is also functional such as a playground and have their mark on it that can catch the

center of attention. Another way that is more efficient and can reach more of the target group is by

placing banners on cars, in this way many people will see it.

Sales strategy This sales strategy will have to follow the marketing plan and accordingly we have the following

strategies:

1. Create awareness in the market

2. Create a customer base

3. Create a product portfolio

4. Get at least 10 customers

5. Collect feedback from the customers

6. Build a fan community on social media or website

7. Create leads and increase lead conversion rate

8. Identify BATNA for the services

9. Seek promotion partners

10. In order to achieve the strategies, we have to further divide them into operational strategies or

tasks.

Tasks

1. Public relations person will maintain updated posts and write articles on the company’s projects

and achievements

2. Make a list with potential customers including their name, contact information, industry and

what kind of service they seek for

3. Make pictures and design a document where all the projects and products are included that

seems appealing

4. Build a set of questions and call the clients for the feedback or send them and email.

5. Create giveaway contests that assures a prize if the comment their ideas and promote the

concept of sustainability as they see it

6. Contact bloggers and online magazines to write articles including Links for About Innovation

7. Meet with the potential clients and identify what is the right price for both parts

8. Desk research

Customer relationship management With the implementation of CRM systems it will be possible to follow up the clients purchasing periods.

It also helps the management be able to predict on the future when the clients will make another

purchase. In this way it will be much more cost efficient to contact the customers at the right time.

Usually CRM is comprised by databases where information about the customer is being saved and

analyzed. Such data bases are costly and at the moment About Innovation does not have the right

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capital to invest in such systems, also their customers are limited and it is easy for the management of

the company to keep track of.

Systems like these will be needed when the company’s marketing plan is taking action and many leads

are being generated.

Balance scorecard The balance scorecard is combined with a strategy map and subsequently an action plan that it will

follow. Each of the three tools are important and combined they can take the big goals and set them

down into achievable actions that can also be counted and controlled.

About Innovation have many tasks to keep track of and little people to manage them. The tendency is

that over time the focus will switch to other goals and the team can become confused at times.

Therefore it is a must that the management is able to set down their longer and smaller goals where

everyone can follow and measure the development of those goals.

With the strategy map we will be able to follow links starting from the financial perspective, all the way

to the learning and growth perspective.

The financial perspective,

Having a look back to the problem formulation and we see that the long terms goal is to increase

revenue by 20 000 dkk during the following year. Increasing revenue or shareholder value can be done

also by improving the productivity.

So the question now is what has to be improved to reach a revenue increase of 20 000 dkk?

Customer perspective

The customers are the ones that will pay either for the service or for the products; therefore it is good to

understand the customers segments, their needs and pains and to grow the relations with them.

Customers are sensitive to how the company is contacting them and in equal measure they are sensitive

to prices. On the contrary, a customer that trusts a brand that is competent and clearly it will bring

those advantages will convince them to spend more. According to the customers About Innovation will

tailor their products, services and strategies so they are sound and appealing.

Internal perspective

Experimenting with product development would be one of the activities that the company will have to

work with for long time. Subsequently, more efficient processes will be tailored such as distribution. The

company has only one utility car that is too small for all the resources and tools to make the projects.

Learning and growth

Probably one of the most important perspective or all where the employees are the ones that have first

contact with the customers and they are also the ones that create the value.

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In this paper you will find specified that the design is an important key element to the value adding

process of the services and products that the company is trying to sell. Learning and growth puts down

the goals that directly will allow the development of the employees. Goals like this would be for the

team to get a designer student from KEA as an intern that can teach them design or work together. Due

to the limited capital, a professional designer will be hard to employ. Another goal that is worth to be

mentioned is to use the help of another CAD student that can easily divide the project into separate

parts so it’s easy to prepare.

I also made a visual representation of the strategy map that can be found in Appendix 3

Balance scorecard

The balance scorecard will be used to measure the objectives outlined in the strategy map. The

measurements will have to be constructed so they can be controlled. Although we have identified the

long terms goals as well and the more achievable goals for the short run, it is challenging to set up

clearly measurable indices that is why About Innovation will have to review the balance scorecard

constantly.

A detailed representation of the KPI’s can be found in Appendix 4

One of the criticisms that are outlined about the balance score card is that ’’the linkage between the

process and the client satisfaction is not proven’’.41 In any case, it is still useful for the company to have a

tool that is tracking the actions taken and also offers an overview and linkage between them. Compared

to the use of no such tools at the moment, for about Innovation this can help more than before.

Lastly, an action plan will help the management and the employees to clearly know when the right time

to complete certain actions is. Due to the fact that About Innovation is doing things on the spot and

sudden tasks arise that needs to be taken care of, the approach to complete the action plan will change.

In any case I have illustrated in appendix 4 a timetable for each target comprised in the balance

scorecard that shows the time to monitor the targets and the resources needed.

The kpi’s represented in the balance score card had been established according to the understanding I

have from the classes and what seems rational and useful. Not all of the kpi’s will work and it is up to

the company to adjust them and improve the assessment of these indices.

Final conclusions The purpose of this research was to find the opportunities for About Innovation to generate more

revenue for the following year selling locally and also exploring the possibilities for international

expenditure.

With the analysis of the internal perspective of About Innovation we have managed to understand how

the value is being added across their value chain. Subsequently we can understand that the company

41

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needs to become clearer on their vision and what are the products and services they would like to

develop further, to whom they can sell it and what the opportunities for revenue are.

Switching the view towards the external environment and we conclude that an expansion on the

Swedish market could be the most appropriate country for internalization due to the same political

framework and the same culture indices. Also, the European Commission has in place the program

INNEON to support the development of sustainable companies that are focused on circular economy.

Also it seems that in Sweden the welfare system offers incentives to companies for training unemployed

people.

With the understanding of the competitor analysis on the local and foreign market it seems that in order

to come to a blue ocean market, About Innovation has to develop a different set of services, that also

are able to compete through design and quality.

Compiling the results both from internal and external analysis of About Innovation lead us in generating

a plan of action that can be identified in the balance scorecard and the action plan.

Lastly, the research made it is a combination of theories and real data, therefore the applicability of the

suggestions made and the results gathered should be further adjusted due to the fact that both

mediums, internal and external are changing.

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Reference list

Appendix

Appendix 1

Income 2017 2018

Direct sales of products 7 000 dkk 10 000 dkk Sales of interior design services 7 000 dkk 15 000 dkk Sales of creativity and innovation workshops

5 000 dkk 10 000 dkk

Income from memberships 1 000 dkk 1 000 dkk Total income 20 000 dkk 36 000 dkk Expenses Container and building expenses 200 000 dkk - Utilities bills for the new venue 10 000 dkk 10 000 dkk Cost for the gas for cars 4 000 dkk 4 000 dkk Computers 5 000 dkk (first year ) - Internet bills 700 dkk 700 dkk Unexpected expenses 3 000 dkk 3 000 dkk Total expenses 222 700 dkk 17 700 dkk Yearly total -202 700 dkk 18 300

Appendix 2

Income 2017 2018- 10% increase Founds and competitions 100 000 dkk - Benches 5 000 dkk - Pillows 1 750 dkk - Sales of workshops 3 000 dkk - Seles of projects 9 000 dkk - Café sales 2 000 dkk - Subscriptions members 5 000 dkk - Total 125 750 dkk 138 325 dkk Expenses

Containers 200 000 dkk - Windows 50 000 dkk - Cables and electric materials 20 000 dkk - Workforce builders 20 000 dkk - Materials for foundation 10 000 dkk - Coffee beans 2 470 dkk 2 470 dkk Coffee machine 9 340 dkk -

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Fridge 1000 dkk - Glass display 13 362 dkk - Gas for cars for distribution 5000 dkk 5 000 dkk Salary for part time café employee

72 000 dkk 72 000 dkk

Website administration 1 000 dkk 1 000 dkk Water 3 600 dkk 3 600 dkk Electricity 4 800 dkk 4 800 dkk Printing machines 2 000 dkk 500 dkk Other costs 50 000 dkk 50 000 dkk Total expenses 464 573 dkk 143 670 dkk

Appendix 3

Appendix 4

Balance scorecard Action plan Time used

Measurement Target Financial Number of sales made 10 Monthly

monitoring 1h

Number of founds applied for

1

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Number of competitions attending

1 Once in 6 months

1h

Customer Numbers of surveys made for customer needs and wants

10 Monthly 5h

Number of prototype offers created for the customers

10 Monthly 40h

Number of contacts with the potential customers

Email, phone. Monthly 1h

Number of public appearances

Newspaper, events, networking 10

Monthly 10 h

Internal Number of calls, of send emails to check the interest of the customer

20 Monthly 2

Number of attempts to create a structured working way for the projects

20 Daily 1h

Number of leads generated

10 000 Weekly 2h

Number of leads converted

1000 Weekly 5h

Learning and growth Attempts to headhunt a capable design student

2 Weekly 2h

Number of attempts to acquire a CAD designer

2 weekly 2h

Number of seminars to educate the employees about the customers

5 Once a month 2h

Appendix 5

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