Strategy Business Management - Navitas - Assignment Example

Strategy Business Management Student’s Name Subject Professor University/Institution Location Date Table of Contents Table of Contents 2 Strategy Business Management 4 Introduction 4 Company’s current tactical approach 4 Fit between companies’ strategy and their objectives and expectations 8 Strategic plan 10 Navitas 10 Vision 10 Mission 10 Objectives 10 Strategies 10 Kaplan 11 Vision 11 Mission 11 Objectives 11 Strategies 11 Conclusion 12 List of References 13 Executive Summary Education is being given a first priority in the current society. Most governments are now providing free education programs to ensure that citizens acquire basic education. Navitas was started as an IBT Education but it has grown and entered the US market in 2005. Kaplan is also an education provider which started as a test preparation centre. Strategies are categorized into corporate, business and functional strategies. A good strategy should focus on a given market. Kaplan offers kindergarten programs, masters and bachelor degrees, training and licensing and English language. Navitas offers university gateway programs to students in order for them to cross over and study in Australia. Navitas’ main objectives are offering degree programs and raising its share value. Kaplan intends to increase its incomes, offer doctorate degrees and raise additional funds. Strategy Business Management Introduction According to Berryman (2007, p.34), education is at present considered as a basic need for all individuals in the society. This is because; it determines the kind of life a person will lead since his or her education level is used as a qualification for available job opportunities. The significance of education is seen where most governments are providing free education to children as part of their development strategies. The introduction of free education has led to a decline in the quality of education in public institutions and thus many people nowadays prefer private institutions to public ones. Navitas is an education provider which started as an IBT Education and entered the market of US university education in 2010 (Li & Hubbard 2010, p.467). Kaplan is a private education company which was founded in 1938 as a test preparation centre. At the moment, it is actually one of the biggest diversified educational firms around the globe and operates in over 30 countries (Li & Hubbard 2010, p.470). This paper will analyse and assess Kaplan and Navitas’ current tactical approach, the fit between the firms’ strategy and their objectives and expectations. It will also provide strategic plans for both companies. Company’s current tactical approach According to Nayeri, Mashhadi & Mohajeri (2007, p.231), strategies are grouped into corporate, business and functional strategies. All the strategies assist firms to develop a competitive advantage over its rivals in the marketplace. They give directions to a company when it enters new markets. Friga & Bettis (2003, p.240) maintains that, a good business strategy should have a focus. A firm should establish a niche market, focus on it and be in a position to cater for the needs of that market. This helps a big deal in retaining customers since a satisfied customer will always be loyal to the firm that gives him or her satisfaction. In addition, functional strategies help a firm to work towards the achievement of preset organizational goals and objectives by each function (Friga & Bettis 2003, p.241). Kaplan started as a simple education centre for preparing students to join colleges in the United States. It has however, grown overtime and it now offers several programs which include test preparations as well as admissions for graduate school and university curricula, English proficiency and licensing of professionals like doctors and lawyers. It also offers higher education programs ranging from certificates to master degrees along with online and distance learning. Additionally, Kaplan offers professional development, training and licensing curricula in IT, accounting, finance, real estate and insurance. Moreover, it provides kindergarten and programs for kids aged below 12 years (Li & Hubbard, 2010, p.470). Drawing from Li & Hubbard (2010, p.468), Navitas was started as an IBT Education providing a gateway program which was a one-year diploma. The program was used to qualify students for bachelor degree programs and was devoted to support international students’ shift to universities in Australia. It later opened a college enrolling less than 200 students. Its enrolment has really grown now and it is even listed in Australia’s Stock Market. Fischer (2008, p.A42) claims that, Navitas is currently the biggest private giver of gateway students to universities in Australia. It has been able to achieve all these due to focus in the education industry and capitalizing on opportunities. According to Carroll (2007, p.8), adopting a wide range of programs is a good business strategy. This is because; it enables a company to reach as many and diverse customers as possible since each type of customer will have a program that specifically suits his or her education needs. A wide customer base provides the company with many growth opportunities in efforts to cater for all customers’ different needs. Hatakenaka (2010, p.91) further says that, the education field is expanding and competition is increasing. The field’s needs are also taking a different form due to the advent of edge cutting technology and changes in the business and work. New education programs and systems need to be devised so as to fully equip learners with relevant knowledge as well as skills to help them fit well in the job market (Hatakenaka 2010, p.93). Blumenstyk (2003, p.A30) says that, Kaplan offers a wide range of programs from basic education curricula to higher education and professional certification which ensures that students learn from one institution right from their lower level education until they reach high level. Navitas provides university programs, English language classes, workforce recruitment and training programs as well as student recruitment. This promotes consistency in educational doctrines and standards since the different levels of learning institutions will be headed by the same management (Li & Hubbard 2010, p.469). In my opinion, running many programs is a cumbersome process for both companies and requires different strategies for each program. One business strategy for all the programs and all the companies’ branches across the globe may not be effective. This is because; different programs have different goals to accomplish and also the branches operate in diverse business environment all of which require specific strategies for them be to be successful. Moreover, the idea of consistency in education standards is less likely to work for Kaplan and Navitas because; less students will be willing to school in the same institution for all their education levels. According to Hitt, Ireland & Hoskisson (2011, p.14), a big percentage of students prefer schooling from different institutions which offer diverse doctrines. Another strategy that Kaplan and Navitas are currently using is growth strategy. Kaplan aims at becoming the biggest private provider of education services across the world, competing with both public as well as private companies that do not meet the mounting global education demands. In its strategy, it decided to enter Australian market towards the end of 2005 by acquiring Tribeca Learning Ltd. Tribeca offered accredited professional and educational curricula to over 20, 000 professionals in the finance industry every year in Australia. The acquisition was a great move for Kaplan mainly because it matched its business department which was offering financial course in countries like the United States, Shanghai, Singapore and Hong Kong (Kaplan Moves Beyond Test Preparation With Purchases of For-Profit Colleges 2002, p.A36). According to Li & Hubbard (2010, p.468), Navitas has expanded its operations in Australia and has partnered with several universities like Griffith in Queensland, La Trobe in Victoria and Flinders in SA. It has also extended to the United States and works together with universities like Western Kentucky and Massachusetts Lowell. Drawing from Sadler & Craig (2003, p.76), a good strategy should revolve around the needs of customers since they are the main reason for the existence of a company. When developing a strategy, a firm should carry out a market research on the current as well as future needs of the customer and be able to devise ways of meeting those needs. It is on this basis that the concept of divergence comes in. Joyce & Woods also stipulate that, a firm should aim at distinguishing itself from its competitors in terms of the kind of goods or services that it offers. The firm should look for any unexploited market space and be also in a position to go past the existing demand, create and cater for the new demand (Joyce & Woods 2004, p.111). According to Barker & Habermann (2007, p.38), Kaplan’s plan to penetrate the Australian market was mostly based on discovery of unsatisfied needs. There was a growing demand for university degrees as well as a need to become English proficient for Australian students. In spite of Navitas’s operation in the country, its education programs were not sufficient. This is seen where Kaplan went ahead and further expanded its operations in Australia by acquiring Finsia Education, Bradford College alongside Grange Business School. Teichman fruther says that, Cross-selling openings and links with prevalent educational offers in Australia contributed a great deal to Kaplan’s growth in the country. However, the fact that big companies like Navitas entered the market before Kaplan poses a big threat to its success. Navitas offers similar programs to those of Kaplan and presents stiff competition (Teichman 2008, p.10). Li & Hubbard (2010, p.467) holds that, Navitas’s plan to go into the United States’ market was aimed at presenting students in that country with education opportunities to cross over to Australia. This was a significant approach because students will always be willing to move to other countries and explore their education systems and resources. The fact that, there were no other companies offering similar programs increases Navitas’ chances of succeeding in the new market which has already been witnessed through its collaboration with universities in the US. Fit between companies’ strategy and their objectives and expectations Dess & Lumpkin (2009, p.155) asserts that, a good business strategy is one that includes the best way to realize the objectives and meet the expectations of a company. It should also be feasible. Business strategies should take in to consideration the capabilities of a firm to implement them in order to ensure an effective implementation process. Mintzberg further argues that, the capabilities of a firm may take the form of human resources, financial resources, premises and equipment. A company should have knowledgeable and experienced management to carry out the formulation of the best strategy for the company (Mintzberg 2004, p.67). The management will require the assistance of skilled subordinate staff in implementing the strategy. Funds are also needed alongside suitable equipment and buildings to support the human resources’ activities (Erridge, Fee & McIlroy 2010, p.5). According to Li & Hubbard (2010, p.470), Kaplan’s main goal is to assist people realize their educational as well as professional goals. Kaplan’s strategy concentrates mainly on growth in terms of the services it offers, the number of markets in operates as well as the number of partner institutions it works with. The fact that it offers so many programs from lower to high level education helps people a lot in achieving their education goals since there are ready education opportunities for that. In terms of profession, Kaplan gives knowledge to people in various fields like finance and real estate and further offers career development, licensing and training services to the same people assists people to grow both personally and career wise. Therefore, Kaplan’s strategy very well matches its goals. Navitas intends to become universally acknowledged as the uppermost trusted international learning organization around the world. The firm mostly focuses on transition programs for students in other countries to move to Australia and study from there. Its programs have really attracted students from countries like US, Zambia, Kenya and Singapore. This is evidenced by the ever increasing level of enrolment for foreign students under the program. It has become a leader in the transition programs and students as well as partner colleges have faith in it. It can thus be said that, its strategy fits with its goals and expectations (Li & Hubbard 2010, p.469). Strategic plan Navitas Vision Navitas aims at being globally identified as the highly trusted global education company. Mission Navitas is a multinational learning organization which offer transition programs to students who wish to study in Australia. It in addition offers English language courses, staff training and recruitment and student recruitment services. Objectives Navitas’ major objective is to commence offering university degrees on top of its transition programs, to students in the countries in which it operates. It also aims at increasing its share value in the Australian share market so as to be able to give higher dividends to its shareholders. Strategies In order to be able to offer degree programs, Navitas will open independent universities and hire lecturers to teach its students. Moreover, it will undertake more acquisitions of reputable institutions in efforts to expand its customer base. According to Hill & Jones (2012, p.139), acquisitions resulting in a broader customer care in turn lead to high profitability. Huge profits will result in a rise in Navitas’ share price. Kaplan Vision Kaplan intends to be the biggest private education company around the globe. Mission Kaplan is a for-profit education firm that offers a number of education programs such as kindergarten and early childhood programs, English language, certificates and bachelor and master degrees. It also offers training and recruitment for professionals in the fields of IT, insurance, accounting and finance. Objectives One of Kaplan’s main objectives is to increase its revenues by 45% in the next five years. Its revenues have really improved in the recent years mainly due to its acquisition of several colleges. In addition, Kaplan plans to start offering doctorate degrees in the fields of finance, real estate and project appraisal and management. Kaiser & Ringlstetter (2011, p.118) maintains that, most economic and social activities across the world are involving finances and thus there is need of enhancing the expertise in that field. Moreover, many people are entering into real estate business and new ventures which further increases the demand of professionals in those areas. Furthermore, Kaplan intends to raise more funds to assists in its expansion plans in its education programs. Strategies Kaplan will earn more revenues by entering new markets like Africa and Latin America. Africa has many education needs which need to be catered for and thus it will present a good market for the company’s plans. Latin America will give market for English Language because most people in the continent use Spanish. In order to have the capacity to give doctorate degrees, Kaplan will hire new professors who are highly experienced in the field. According to Knapp & Siegel (2009, p.23), having skilled personnel ensures that high quality education is delivered to students. Lastly, an Initial Public Offering will be undertaken to raise the needed funds. This method is very beneficial because it will help Kaplan to be listed in the United States Stock Market. Moreover, it is a permanent source of funds. Conclusion Navitas and Kaplan are established global education companies offering a wide range of programs in different countries. Navitas strategy is based on university gateway programs while Kaplan focuses on acquisitions so as to enhance its growth. Both Navitas as well as Kaplan’s strategies match with their organizational goals. Navitas’ main objective is to start offering degree programs and to increase its share value. Kaplan aims at increasing its revenues, offering doctorate degrees and raising additional funds. 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Friga, PN & Bettis, RA 2003, Changes in Graduate Management Education and New Business School Strategies for the 21st Century, Academy of Management Learning & Education , 2 (3), 233-249. Hatakenaka, S 2010, What's the point of universities?The economic role of universities in Japan, Japan Forum , 22 (1), 89-119. Hill, C & Jones, G 2012, Strategic Management Theory An Integrated Approach, Hampshire, South-Western Pub. Hitt, MA, Ireland, RD & Hoskisson, RE 2011, Strategic management : competitiveness & globalization, Mason, OH , South-Western Cengage Learning. Joyce, P & Woods, A 2004, Strategic Management:A Fresh Approach to Developing Skills, Knowledge and Creativity, London: Sterling. Kaiser, S & Ringlstetter, MJ 2011, Strategic management of professional service firms : theory and practice, New York, Springer. Kaplan Moves Beyond Test Preparation With Purchases of For-Profit Colleges, 2002, February 15, Chronicle of Higher Education , 48 (23), p. A36. 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