Detailed solution

Organization expansion strategy:

When analysed the case it was found that there are many gaps in current daily operations of the organisation. As mentioned above there are many challenges and problems on the side of organisations that need to be solved first before going for the expansion. So following draft first addresses the problem in existing problems and provides solutions on the same and there after the expansion plan is mentioned. Below mentioned plan is a 5 phase expansion plan over 10 years of time.

1. Concentration Strategy Working on existing product, market and customer base. (phase 1) (next 6 months)

To improve the brand image and encourage the positive word of mouth publicity the company need to work on the core competency of the organization. To do so company needs to fill the gap between the customer expectation and organizations quality of service.  

• CDC (customer delivery code): This will allow customer and company both to ensure right product is delivered to the right person. In this the customer will be given a code for the delivery on the app and after the customer shares the code, delivery partner will hand over the product to the customer. For eg: Food Panda

This will eliminate the problem of wrong delivery being made and also missing delivery. This will ensure the accuracy in the delivery and minimize the delivery issues.

• Incentives to delivery partners: Delivery partners should be given monetary and non-monetary incentives to encourage them to work harder and more responsibly. Monetary incentives like if they do “no complaint delivery” then they will be given reward for that particular week. And non-monetary rewards can include life insurance, award like “delivery partner of the month”

This will create a competition between delivery partner and reduce the unplanned absenteeism and also ensure the best performance form them.

•  Live tracking and delivery person rating:  live tracking like used in Zomato and Swiggy can be done to ensure the sincerity of delivery partners and timely delivery, once the delivery partner know that they are being watched by customers then they will work sincerely and dedicatedly.

Delivery person rating will help in increasing the efficiency of delivery channel and make they more customer centric so that their ratings are better.

Four phase expansion plans:

Phase 2: Product expansion plan (7th month -2 yrs.)

Once the service is improved and brand is well settled in the market phase 2 can commence. In phase 2 more products need to be added to the catalogue to the existing geographic market. Products that can be added are:

Eggs, bread, cornflakes, groceries, meat, poultry, butter, sauces, pastas & noodles (ready to cook packaged), etc

Delivery timing: 5am-10pm for non-subscribed products

                            5am-8am and 7pm-10pm for subscribed products

Minimum basket size for non-subscribed products: 300 INR

Phase 3 : Market expansion in existing geographic area (2-4 yrs.)

In phase 3 the plan is to target businesses for bulk orders and deliveries. Plan is to expand the customer base by targeting untapped market in B2B sector.

Targeting: Restaurants, Canteens, Mess, Hotels, etc

Restaurants can subscribe or order daily for regular supply of products that are required daily like milk, curd, paneer, meat, eggs, etc. bulk discounts will be given and the app used by other businesses will be different from consumer’s app but will have similar features to that of consumer app.

Sourcing: sourcing from this phase would be most likely done directly from manufacturers and will be directly distributed to final customers (businesses and consumers)

In such way company can expand its customer exponentially without investing much into development of new market and minimise the risk of expanding into new geographical area.

Phase 4: Geographic expansion into new markets (4 yr. onwards)

In this phase the company will expand its full-fledged operations into new markets of tier 1 likes Mumbai, Kolkata, Pune, Chennai and tier 2 cities like Lucknow, Goa, Jodhpur and tier 3 cities like Surat, Kanpur, Kochi, Nagpur.

Plan is to expand in at least two tier 1 cities, one tier 2 city and one tier 3 city each year.

Reason to target tier 2 & tier 3 cities are there exists vast potential which is untapped that can be leveraged by being the market pioneer by entering 1st in those markets. Challenges of operational cost can be tackled by an example given below.

Usually according to industry standards, salary in tier 2 and tier 3 cities are comparatively lower than tier 1 cities. Here is a contradicting yet unique and feasible solution to a problem to reduce the overall cost of salary yet increase the productivity.

Estimated cost/delivery is calculated on the minimum delivery requirement, actual cost per delivery will be much lesser than estimated one. (cost=salary for above table)

Using above mentioned plan, operations in tier2 & tier 3 cities can be started and expect to run well with low salary cost and better output. Advantage of entering in such market is it’s a huge untapped market and huge companies usually avoid entering in those markets and DND can leverage the advantage of that situation.

Phase 5: Backward Integration (6th yr. onward)

In this stage company is advised to integrate backward and start manufacturing sourcing milks from various places and create inhouse dairy brand and also manufacture other dairy products like curd, butter, buttermilk, paneer, etc. The initial investment would be huge to do so but that will diversify the portfolio and also spread the risk of business failure across various sectors and businesses. Backward integration is suggested to expand the operations of dairy products to nationwide competitors by leveraging the advantage of widespread network of the parent company i.e. DND. Until the end of 6th year, the company will have its presence in almost 15 cities across various parts of India (if everything goes according to plan). This will support the backward integration and help to cut the purchase cost of dairy products.

Plan for backward integration:

1. Takeover the local dairy manufacturers and buy that business instead of creating additional competition.
2. Contract manufacturing and packaging on DND’s behalf from the local manufacturers.

Solutions on organization culture:

Organizational culture

According to me culture is defined as the sets of value, norms, behaviour, customs, knowledge, beliefs, etc that prevails in and around your surrounding environment. Organization culture is no difference, its just in organizations context. The culture of an organization depends of how the organization first treats the employees and what they expect them to behave in organization. So, it is true that organizations culture is formed by employees but it is enrooted in the organization itself.

My advice to DND is to create a joyful, helpful, creative, open, casual, yet responsible work culture. Culture should be such that employees feel motivated and consider themselves as the part of the organization family. Since the DND deals in daily essentials, it needs to create such environment that the communication is done faster and decisions are taken faster, because no customer is going to wait for hours to his problem to get resolved. He will straight away get out and buy the essentials himself.

For example: The case of Hari Krishna Dimond Exports: Savji Dholakia, the famous diamond merchant had created such work culture in his organization that during financial crisis, employees themselves suggested that they will take 50% of their salary to support the organization. This was done by properly taking care of the employees and their families.

Since employees are the most important assets of the organization and organization culture is one of the motivating factors to keep employees happy, management should follow following steps to create a positive and motivating organizational culture.

According to Maslow’s theory of hierarchy of needs if basic and security needs are fulfilled, people are satisfied and motivated to work harder and by using same principle following solution is prepared.

1. Quarterly training and development: Monthly training and development should be carried out to educate employees and delivery partners on the new trends and changes in the industry and also on the work ethics. Major attention should be given to work ethics so that employees don’t misbehave in the organization. Sessions on gender equality, work-life balance, stress management, etc should be carried out regularly to motivate and keep employees educated.
2. Encourage problem solving and analytical attitude: DND should encourage problem solving and analytical attitude amongst its corporate employees. This will help organization to solve many problems related to anything before it gets any bigger.
3. Weekly yoga sessions for everyone: This will keep employees positive and relaxed. Yoga is a great stress buster and helps in reducing anxiety and also this will rise a sense of belongingness amongst everyone for organization and also improve bonding between employees.
4. Quick decision-making powers to employees:  Employees should be given freedom in terms of decision making. This will make every employee more responsible and task oriented. Also, the DND deals in essentials and perishable items and such items need fast response if any problem arises.
5. Installation of ERP software: ERP will help in quick cross functional communication and information sharing. This will encourage transparent, fast and accurate communication and decision making in the organization.
6. Flat/Horizontal organizational structure: organizational structure also has great impact of the organizational culture. Since DND is a startup and needs for space for innovation, initially falter organizational structure is suggested to promote innovation, quick decision making, and communal harmony.
7. Customer centric approach: organization should make every employee understand that “their salaries are going to come from customers”, so they need to keep customers at the centre of each and every decision taken.
8. Importance to the family of employees: organization should provide employees with family insurance, carry out outings with families once a year, invite families of employees in the annual functions, etc. At last everyone is working to keep their family safe, healthy and happy. This will make employees feel that whole organization is one family.
9. Basic and essential accessories to delivery partners: since delivery boys are on the field and are at risk they should be provided with basic accessories like Bluetooth devices to answer calls from customers and customer care executives, box that can be attached to bikes instead of back bags to reduce the stress and load on the delivery boys, etc.
10. Relaxing and playing zone: organization can have a small relaxing zone that can have board games, carrom, etc to relax and release the work stress.
11. Strict policies for performances: with all the above facilities given employees should not become lethargic so there should be strict performance policies and one must abide to those standards.
12. Lead by example: leaders should lead by examples and themselves involve in the work instead of giving the orders. Although there will be hierarchy for reporting and flow of information but there will be no boss in the organization. Everyone will be boss and will be allowed to take their own decisions until the organization is small.

Management principles used to draw solutions:

For expansion:

1. Concentration strategy
2. Product expansion strategy
3. Market expansion strategy
4. Diversification strategy
5. Geographic expansion strategy
6. Vertical integration (backward)

For organizational culture:

1. Motivation
2. Rewards
3. Organizational structure
4. Leadership
5. Maslow’s theory of hierarchy of needs

Optional assignments:

Growth strategy for next year:

Next year company can plan two stage growth strategy wherein they can….

Stage 1: concentration strategy/ penetration strategy

First 6 months of the year can de dedicated to heavy marketing and improving service quality and penetrating existing market through existing products. In this strategy company can invest in digital ads and perform aggressive targeting and feed on competitor’s market share. In this, company will strengthen its position in current market.

Stage 2: product expansion

Next half of the year: although this stage starts after 6 months but the planning and organising the resources starts from the start of the year. Company needs to plan on expanding the product portfolio that company offers for delivery. Products that can be added are eggs, meat, cereals, bread, bakery items, etc. This will help to generate more revenue through greater offerings

Use of AI (Artificial intelligence)

For overall customer delight company can develop AI (artificial intelligence) driven e-commerce website. AI can help increase sales by understanding consumer behaviour through various data points and suggesting customers various products that they would like to buy. It may customize the app feeds and search results according to the taste of particular customer. Personalization marketing is possible with the help of AI technology.

To develop such App, you can contact Shoptimize India Pvt. Ltd. That develops AI driven platforms.

Taglines:

“Palkhe jhapkao, Order pao” (featuring speed of delivery)

“ZatPat Fat Fat” (featuring speed)

“it does exactly what it reads” (explaining the business)

“itna fress ki mann kare order karte jaye” (featuring USP and persuade to take action)

“order karte jao” (action oriented, asks customers to order)

“one stop for all your daily needs” (features the range and variety of products offered)

“celebrate each order” (features the overall customer experience and delight)

 “delivers at the speed of light” (featuring the speed of delivery)

Content writeup for promotions with design

LOGO for DND

Above logo describes the frame of reference that is E-Commerce industry with a cart in the centre and the legs and handle forming letter ‘N’ and conveying the name of the company DND. Colour blue shows trust and colour orange shows excitement, enthusiasm, and warmth.

Do Not Disturb Door Hangers for promotions

Above concept can be used as social media post or actual goodies to be distributed for promotion. For example one will hand this outside their house and people passing by will see this and get a brand recall.

quarantiner post:

Above Social Media Ad can be used during current scenario or lockdowns and targeted towards particular geographic area to increase sales.

Eat-Drink-DND-Repeat

general social media post that can be used to remind audience of DND