Analysis of the High-Tech Company

Topics: Strategic management, Electronics, The Profit Pages: 10 (3690 words) Published: March 13, 2013

This report will analyse the overall situation facing the Lucky MT company. Before the actual report, a brief analysis is needed in order to introduce the current situation of the company. Lucky MT is an Electronic Manufacturing Services (EMS) business located in Singapore. It started as a joint venture between two American companies TelNet and MedTech. In the first couple of years of its existence, the company faced the difficulties that occur to a lot of joint ventures, such as wage rates. However, during the next decade the business continued to grow and expand. The partners became more confident about their capabilities and therefore moved the business from United States to Singapore. Nonetheless, the aspirations of both partners continued to grow apart, as TelNet was keen to keep a close relationship with Lucky MT, while MedTech was feeling that they are too reliant on the company and wanted to treat is as a supplier. Ergo, a plan for independence was developed and implemented shortly after. It had a lot of aspects, such as new employers or new clients but the most important thing to note is the change of the shareholders, the original joint venture companies were replaced with two equity funds as owners of Lucky MT: Star Private Equity and SEA Partners. This was followed by three years of sales growth. Current year, however, pose a serious challenge as there are a lot of issues that have arisen and this report is a recommendation of how to cope with some of them. The structure of the report will be quite simple. There will be several areas of strategic uncertainty excluded in separate sections. Each of these areas will be analysed from a variety of standpoints: risks, opportunities, possible course of action, etc. In order to ensure an effective analysis, various tools and techniques such as risk assessment, cost-benefit analysis, SWOT model, SAFe evaluation model, etc. After the analysis of the key areas that are in need of improvement or possess a beneficial opportunity for the company, the key findings and suggestions will be summarized in the last part of this report, which will offer a strategy for Lucky MT that would ensure its survival in the competitive EMS market.

PESTEL environmental analysis

It is important to understand the environment in which the business operates. The factors that can affect it can be analysed using various frameworks, one of which is the PESTEL approach. It is used in order to identify the factors that will support and impact upon the organisation’s strategic planning (Yeates & Wakefield, 2004). It is important to note that this is environmental scanning, so this analysis will not incorporate the issues in the company itself. The information used in this section is from the Singapore’s electronics industry report. From a political point of view, the policy of Singaporean Government is favourable for Lucky MT. The government realised that a small country like Singapore cannot compete in low-cost assembly operations and is putting a lot of effort into creating Singapore’s image as a centre for high-end manufacturing. This is exceptionally beneficial for the company as it operates in the principle of low volume and high value. This means that Lucky MT produces products of high quality, which is exactly what the government is encouraging to do. Another governmental incentive that is worth mentioning is the Economic Development Board (EDB). This organization works to encourage investment into Singapore electronics market, especially concentrating on attracting foreign investment. This is important because one of the most significant issues of Lucky MT is the reliance on two main clients and finding new investors would help to relieve this burden. Another beneficial EDB policy is providing incentives aimed at high-tech firms which is obviously an advantage for our company as it produces high-quality products. Finally, since the year 2000, the Government has reduced...
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