This briefing paper looks at finding the right business and growth models that Extraz, a UK-based industrial appliance company, may consider before moving into Europe within the next 12 months, and before going global within the next five years.
The Mckinsey Growth Model
This model will act as a basis for the courses of action to be taken in respect to Extraz. The Mckinsey growth model argues that businesses should develop their growth strategies based on operational skills, privileges assets, growth skills and special relationships. (Jim Riley, October 2012) With reference to these four key points, the following has been noted: Operational skills: Etraz’s skilled employees and well-equipped plants. Privileged assets: High quality products at a competitive price, thus increased value for customers. Growth Skills: Extraz may come up with new product developments. Special Relations: As Extraz provides industrial goods to hotels, it has a good database of clients. Many hotels have branches around the world. Through proper communication, Extraz may develop its database of clients through its existing clients. In order to achieve a sound growth strategy, Extraz should consider the following methods: Existing products to existing customers
Use of current database of hotels as a link to their branches outside the UK. E.g. If Hilton UK is currently a customer, Extraz may advertise its products to Hilton found in GErmany by using its relationship with Hilton UK. Existing products to new customers
Consider selling current products to a new database of clients. Extraz should focus on
o determining the regions where there is a demand for the products; SID: 12007192 Page 2
o building brand awareness and;
o strategic distribution channels which are easily accessible to clients. New products and services
Though it is risky and involves additional investments in terms of finance and human resource, Extraz may opt for developing...