Term Paper - Strategic Management
Term Paper - Strategic Management
Term Paper - Strategic Management
SUBMITTED BY
SUBMITTED TO
Md. Mobarak Karim
Sr. Lecturer
Department of Business Administration
WUB
WORLD UNIVERSITY OF BANGLADESH
Recommendations 20-21
Conclusion 21
Abstract
SWOT analysis is an established method for assisting the formulation of strategy. It is one of
the most powerful analysis techniques. It is useful in exploring possibilities for new efforts or
solutions to problems and making decisions about the best path. The aim of this work is to
analyze various perspectives and to determine its strengths, weaknesses, opportunities and
threats.
This report is containing the overall history of Bashundhrara group, product line, strategy, top
level decision, functional level decision, economy, market and ethical issues. It also full of
relevant information that supports any company if they try knows about the Bashundhrara
Group. According to your proper instructions, we have worked on “Strategic Management
Analysis of Bashundhara Group.”
Introduction
Bashundhara Group which is one of the largest conglomerate business in Bangladesh. The
purpose of the study is to know what strategies Bashundhara group undertakes and how it
holds its competitive position in the industry. Bashundhara Group started its operation in
1987 as East West Property Development. It was founded by Ahmed Akbar Sobhan. Their
first successful project was with real estate venture. Bashundhara Group grew immensely
through different expansion. It took less than 10 years to grab the market and today it
operates over 20 major concerns throughout the country. To understand the competitive
advantage of Bashundhara Group, an internal analysis has been done, to analyze the strength,
weakness match the external opportunities and threat. The next part of the report explains the
three important strategies of Bashundhara Group which is corporate level strategy, business
level strategy and functional level strategy. Corporate level strategies explain what top level
decisions the top level management in Bashundhara Group takes when it comes to long term
profitability and future goal of Bashundhara Group. This includes expansion plans,
developing new products for new markets and forming strategic alliance with other
companies. The business level strategies focus on how they can add more value for their
customers and exploit core competencies to remain competitive in the industry. The
functional level strategies implemented focuses on how Bashundhara Group can achieve
competitive advantage through increasing efficiency, innovation, quality and superior
responsiveness to customers. After that it will be discussed about the ethical issues that faced
by the Basundhara Group and how they solve those problem. The last part of the report
briefly describes the implementation and recommended solutions.
Literature Review
Major causes of miscommunication
Power distance
Distance between different departments
Employees are not well informed
Management and employees not in good term
Mission
Bashundhara Group believes in serving the people and the country. It had come into presence
with that belief and adopted „For the People, For the Country’ as its core theme.
Bashundhara Group concerns try to offer best possible services and products to its customers
for attaining their full satisfaction. It always tries to introduce new products and services to
the customers. They believe that no organization can grow without an able and dedicated
staff behind it. They want to grow together with its partners, patrons, customers, employees
and other stakeholders. The group helped many poor and neglected people through different
philanthropic services and it wants to expand these across the country for the welfare of the
people and development of the country.
Vision
Bashundhara Group has already established themselves as one of the largest conglomerates
and the leader in many areas of business and industry in Bangladesh. They want to go far
ahead from where they are right now. The group wants to be the largest business house of the
country and the biggest contributor from the private sector. It also wishes to create more job
opportunities for the Bangladeshi people so that they become the largest employer in the
private sector.
Values
Bashundhara Group has implemented nationalism, decency, fair practice and service to the
nation as its principal values, which also turn as the main basis in its decision-making. These
values have shaped a moral range for everyone at the group from the top management to
ordinary employees and created the organizational culture consequently.
Lines of Business
Real Estate
East West Property Development (Pvt) Limited: The first and prime projects which is
popularly known as “Bashundhara”, situated near the Baridhara Diplomatic Zone (East West
Property Development (Pvt.) Ltd, n.d.), It was established in 1987 since then they don‟t have
to look behind. Now it is the best housing property of Bangladesh.
Radio Capital: Radio Capital is the newest unit of the media house. The infotainment radio-
station started formal transmission with the slogan ‟The Beat Goes On‟ in January, 2017. It
goes on the air from the tallest transmission tower ever raised from the ground in the
country‟s private sector broadcasting history with 94.8 MHz radio-signal spectrum on the FM
band.
News24 (TV channel): News24 is a news-based nonstop satellite television channel and the
fifth venture of East West Media Group Limited. The TV channel started formal streaming
on the air on July 28, 2016. The television channel has already become successful in making
a vibrant presence among the viewers at home and abroad by its objective and in-depth news
coverage alongside the news analysis and meaningful presentation of people‟s reactions and
expert views on events of public interests.
Retail Commodity: Bashundhara group make sure superior quality of finished goods.
They have Basundhara Atta, Maida, Suji, Soybean Oil, Pam Oil, and vegetable ghee in their
retail commodity.
Snacks: Bashundhara has come up with snack items like instant noodles, stick noodles,
instant pasta. Chips brand like Poppers in Coconut Vanilla and Spicy Cheese flavor &
Crackers with Masala, Chili Chatka, Hot & Sour, and Pickle Flavor.
Cement
King Brand cement: One of the production of the Basundhara cement industry which is
produced in Meghna cement mill. Meghna Cement Mills Limited is the first industrial
enterprise of the Bashundhara Group and the largest of its kind in the country. It was built on
9.83 acres of land inside the Industrial Zone of Mongla Port on the bank of the river Pashur in
1992 and started commercial production on January 15, 1996. It is producing nearly 0.78
million metric tons of Portland cement a year using high-quality raw materials procured
mainly in Thailand, Oman, Japan, Korea and Vietnam Another production of Bashundhara
cement industry.
Paper
Paper: Paper is one of the most profitable venture for Bashundhara group. The prestigious
and best-selling brand „Bashundhara A4 Paper‟ and White Printing Paper (bulk) are being
produced by them. They also have A3, industrial paper under their paper sector.
Tissue products: Bashundhara tissues are very popular throughout the country which offers
a variety of tissues like toilet tissue, facial tissue, paper towel, paper napkin etc.
Hygiene products: Basundhara also makes hygiene based products like sanitary napkin,
diapers, hand gloves etc.
Energy
LP Gas: Bashundhara LP Gas Limited is the first private Liquid Petroleum Gas bottling and
marketing company in Bangladesh. It started operation at the Mongla Port Industrial Area in
1999. The company has succeeded to secure larger share of the domestic market of the LP
gas by pushing the public entity – Bangladesh Petroleum Corporation (BPC) out of the race.
Bashundhara LP gas now runs country‟s widest LPG distribution chain.
Sufficient production of filled bottles against the demand and well-planned distribution
network all over the country helped the company become the best of its kind for successive
years (Bashundhara LP Gas Limited, n.d.)
Services
ICCB: International Convention City Bashundhara (ICCB) is the only integrated and mega
facility in the country that was built with a view to redefine the scope and standard of
domestic service industry. It came into operation on January 1, 2015. It is perfect option for
sociocultural, corporate, educational, commercial, national and international events of any
type. Having more than 650 thousand square feet of covered space within its four beautifully
designed halls supported by ample open space for purposeful usage, the facility is equipped
to host big crowd events for up to 20 thousand guests at a time (International Convention City
Bashundhara, n.d.)
Bashundhara Shopping Mall: The 2nd largest shopping mall in Bangladesh which was
established in 2004. The mall is located in Panthapath, near Kawran Bazar,Dhaka.
Bashundhara City is a 19 floor building complex covering an area of 191200 sqft comprising
an 8 floor podium containing retail spaces, theme Park, cinemas, fitness club, swimming pool
and food court with a 19-storey Corporate Office of Bashundhara Group.
Shipping
Bashundhara Dredging: Bashundhara Dredging Company Limited formed in March 2010
with the core objectives to help the nation to retrieve its old heritage of river transportation
and thrive the economy as a whole by making all major rivers of the land navigable round the
year. The Bashundhara dredging company Limited has already procured four most modern
dredgers and in the process of assembling several other dredgers at its Katuail shipyard.
Restaurant
Baba Rafi: Baba Rafi, the world‟s biggest kebab chain, currently is being operated in nine
countries with headquarters in Jakarta, Indonesia, has joined the Bashundhara Group and
started franchise operation in Dhaka in September, 2016. A total of nine outlets have so far
been put on operation at strategically important locations in and around the capital city.
Sports
Basundhara kings: The Bashundhara Kings Football club was created during 2013 with an
objective of involving youth in the task of National Sports re-construction and to harness
their energy towards eradication of social evils. The main aim/of the Bashundhara Kings club
is to make the youth a powerful instrument in effecting social, cultural and economic changes
and to channelize their energies.
Rangpur Riders: Rangpur Riders is a professional cricket club based in Rangpur. It was
established in 2012 to compete in the Bangladesh Premier League aka BPL the premier
cricket league in Bangladesh.
Sheikh Jamal Dhanmondi Club: Sheikh Jamal Dhanmondi Club, nicknamed Yellow Fear,
is a sports club in Dhaka, Bangladesh based in the Dhanmondi area. They play in the top-
flight football league of Bangladesh. It was known as Dhanmondi Club before adding the
founder's name after turning into a limited company. Lt. Sheikh Jamal Dhanmondi Club is
one of the most successful football clubs in Bangladesh.
Sheikh Russel Krira Chakra: Sheikh Russel KC is a football club from Dhaka, Bangladesh
playing in the Bangladesh Premier League. It has won Federation Cup (Bangladesh) in 2012
which was their first major title (Sheikh Russel Krira Chakra Limited, n.d.)
SWOT Analysis of Bashundhara Group
This is top qualitative evaluation of the key factors
affection the company. To know how will the company
fairs and how interesting an investment would be, our
analysis follow the market on a daily basis and you could
benefit from their valuable expertise to maximize you
knowledge.
Strength:
Business Segmentation: Bahsundhara is one of the leading company in Bangladesh
which started as a real estate company. Now they have 20 major concern of their
business.
Introduce CRM Software: Bashundhara Group introduced customer relationship
management software to create a better customer service for its tissue unit. It will
make them a unique company in this Tissue segments. This CRM software helps the
customers follow up notes, history, their contact and customer internal
communication (Bashundhara Tissue Wins Best Tissue Brand Award, 2018)
Skilled Worker: Currently 8100 skill workers are working at Bashundhara group on
different sectors. They are going to create another 30,000 employment opportunities
throughout the country.
Total Assets: Bashubndhara is the giant company bin Bangladesh. Now they have
over Tk.15000 million or around US$300 million.
Weakness:
Tax Payer: One of the biggest weakness of Bashundhara group is tax related issue.
They are paying less tax to the government in every year. “The National Board of
Revenue‟s Deputy Tax Commissioner Kabir Uddin Molla filed the case in the court
of a special judge on Jul 25, 2007” (Supreme Court orders Bashundhara Group chief
to surrender in tax evasion case, 2015)
Conflict with landowner: The Company has a very bad reputation regarding land
and land related issues. In 2009, October 16, almost 200 landowners victim in South
Keraniganj raised up their voice against the company for grabbing their arable land
and fishing pond (Bashundhara given 7-day ultimatum to stop its activities, 2009)
Controlling: Bashundhara is the biggest comp may as I mentioned earlier, and it has
multiple business segmentation. So, the company is facing controlling problem in
their employees and sometimes miscommunication inside the executives.
Opportunities:
Introduce ERP for RMG sector: Toggi Services, a technology venture of
Bashundhara group. It has introduced Enterprises Resource designing (ERP) software
package for the attire sector within the country in partnership with international
technical school big Microsoft. They come up with 3 ideas named Porini, nChinga
and hSenid under Microsoft 365 which will boost up the RMG production. Industries
Minister Nurul Majid Mahmud Humayun said Bashundhara group is ongoing
company to cover Bangladesh government digital vision (Toggi Services Introduces
ERP For RMG Sector, 2019). This is their strength in the business industry.
Business Expansion: Bashundhara group expanding its business. It is the biggest
opportunity in this company. They already expanding their business into different
segmentation. They successfully run on their business.
Job creator: Bashundhara group is creating a huge job opportunity in the country.
Every single time they are looking for new employee for their business (Bashundhara
Group: A great job creator, 2018)
Constructional and Mega project: Bashundhara Industrial complex is working
under bashundhara group. They expanding their business to fast growing demand of
cement and mega project of Bangladesh. The company currently produce 21 lakh
tonnes of cement per year and it would be approximately 75.60 lakh tonnes per year
from the next year (Alo, 2019)
Threats:
Increase Competitor: In the market, Bashundhara group is facing day to day
competition. In their business line new product launch in the market. As a result they
are facing difficulties to adjust their business line.
Share market: Bashundhara group share market fall down remarkably. In 2009, their
market share was 62 % but in 2011 that share goes down in 30 %.
Political Situation: Political instability is one of the biggest threats for Bashundhara
group. They cannot take long term plan due to political unrest situation.
The Raw Material price: The rapid change of raw material is another threats for
Bashundhara group. The cost of production is getting high due to higher price of raw
material.
Through SWOT analysis, we try to find out strong and weak point of the company. Here we
find out strong points more than weak point. The employees of the company are highly
skilled. They enjoys work and do not want to avoid it. The employees of the company work
hard to achieve the organizational goals through self-accept the responsibility without any
hesitation. Its market position is good comparing to others. The working condition of the
company is comfortable.
Corporate Level Strategy
Corporate strategy always indicates firm‟s corporate actions with the aim to achieve company
objectives according to the holding on the competitive advantage. It is a continuous process
that requires a constant effort to engage investors in trusting the company with their money,
thereby increasing the company‟s equity. Like Bashundhara group has different types of
products and a group of company, they follow their corporate level of strategy to achieve
their company objective on the basic advantages of the competitive advantages.
Expansion Strategies
Expansion strategies firm aims to grow considerably by broadening the scope of one of its
business operations in the perspective of customer groups, customer functions and technology
alternatives, either individually or jointly. It includes achieving a firm high growth profit of
the organizations. Bahundhara group for their highly uses the expansion strategies on the
based on the Different types of Intensification, integration, Diversification and and also they
takeout their product on the international explanations. They integrate their product on the
horizontal integration, and also the vertical integration. For example Bashundhara cement
integrates on the vertical integration with the king brand cement and takes it to the
Bashundhara cement. they also diversified their product on the related and also the unrelated
Diversifications .the related diversification talks about the offerings can be brought under a
common umbrella For example- Bashundhara papers expand with the same related product
company like Bashundhara tissue. They also expand their product and also bring their
management trainee for their employee on the basis of the expansion corporate strategy.
Stability Strategy
These strategies talks about the strategy by which the organizations retains its present
strategy at the corporate level and continues focusing on their present product and markets.
Like Bashundhara they have a more well-known organizations, they have many well-known
product like Bashundhara cement, Bashundhara tissue, Bashundhara LPG gas and also many
more. On their whole corporate level on the strategy they focus on their products and also
focused on the present stability. Sometimes they also adopted by the firms that are risk
averse, usually the small scale businesses or if the market conditions are not favorable, and
the firm is satisfied with its performance, then it will not make any significant changes in its
business operations. They implemented the pause/proceed with caution, no change strategy
and profit strategy. Sometimes, the firms, which are slow and reluctant to change finds the
stability strategy safe and do not look for any other options and also they are concern about
the present value of the market. They work with a fully corporate level strategy and aware
about their market all of the product.
Reinforcement Theory
That strategy talk about the Retrenchment strategy where the firm are restructure, sell and
divest a business structure. Bashundhara Group sometimes take that kinds of retrenchment
strategy for their companies cost reductions, streamline operations and establish a cash flow.
They always focus on their cash flow statement and if the cash flow goes good they take it for
the reinforcement theory .For these theory sometimes they focused on the Turnaround
strategy which is the restricting strategy for the realigning the operations to be the cost
efficient, and also be a profitable. They also use divestment theory if any of their product line
become losing the corporate objectives. Generally the turnaround strategy are not effective
then the divestment strategy follow their company.
Business-Level Strategy
Business level strategy talks about top level decision regarding a product or a service. For
example Bashundhara coming up with cement that target business professions this is the
business level strategy. Top level decision regarding the line of cement. When coming up
new product this is the question that the company has to answer themselves first. 1. Which
customer segment you target? 2. How will satisfy this people? 3. What is the service? This
things coming up before setting a business when these questions answer Bashundhara are
ready then they get these two positions. 1. Low cost and 2.differentiation. A company can
implement proper business level strategy to maximize the life of the organization. The main
objective is to do this which helps a company to attaining its mission. Moreover, business
level strategy helps to gain competitive advantage by providing value to customers and
exploitation core competence. They face many kinds of problem and challenges, so they
change its business strategy. East west property development was the flagship business for
Bashundhara group. After that the company changed their strategy and go for diversification.
In 1996 they started new business in cement industry at Mongla and Madangonj with world
largest technology”VRM”. Then they started the steel business, LP gas bottling and
distribution, tissue paper and so on. They did not segment any individual group for their
products to use. They produce all the goods for the mass people of our country. They
differentiate their real estate business one step ahead for the project they look in 1980 named
Bashundhara Residential Area. Now they have all the facilities for the people who are living
in this area like, school, university, hospital, shopping mall, and bazar their competitors. So,
it is obvious that Bashundhara group follows diversification strategy as its name says that it is
a group of company, means they have production line in different industries. However, if
Bashundhara wants to obtain leading position in the market they need to add more variation
to their products to make themselves aloof from other competitors. They also follow blue
ocean strategy that‟s why other competitors cannot enter the market easily. They need to
innovate something which their competitors did not think of. For instance,
Functional level strategies includes strategies to use HR, dispensing assets, distinguishing
functional zone inside the association, and coordination of those zones for ideal commitment
to help making progress in organization's business level strategy and corporate level strategy.
The essential requirement to ensure superior profitability of Bashundhara Group lies in
influencing the best mix of the resource and capacities it have. The most relevant departments
required to execute the plans according should ensure four fundamental agenda in the
majority of their endeavors. They are:
Efficiency
Bashundhara Group‟s employees work efficiency is overall good. Their management team
works well in their every sector perfectly. Also, they accomplish any task to the need of their
consumers.
Quality
Bashundhara Group‟s product quality is very good because they always give value to
customer‟s choices. They have many products but their main business is based on Real
Estate. Their real estate business is most popular business in Bangladesh and over the world.
Moreover, their all products are very reliable and excellent those combining the company a
good organization.
Innovation
Bashundhara Group always did experiment with technologies. But their innovation was pretty
low. For that reason, they can‟t target more people. They should try to produce more generic
product and services with new and potential innovation technologies so that they can target a
large customer group.
Customer Response
Bashundhara Group always try to improve their customer responsiveness. It also improve
their customer retention rate therefore increase the profit. If any consumer complain any type
of problem, they always try to response and solve the problem smoothly and smartness. They
need to improve their fast customer problem solving.
Information system
Bashundhara Group always attempts to fabricate a focal or central database. It assists them
with keeping a free progression of data among various departments. It is vital to be sorted
out. In the event that they neglect to do that, at that point they endured seriously. It is
essential to keep pace with what client need and what they are attempting to make.
Ethical Issue
The Ethical responsibility Bashundara Group is related to activities like legal working issues,
Employees feeling of uncertainty, don‟t maintain product quality whereas they are charging a
high price and so many things. The issues are stated in below
Legal working issues: As in Bashundara, we can see that the rainy season the road is loaded
of full water which is made by Bashundara group. So this is not legal workings.
Employees feeling of uncertainty: Many people are afraid of conflict resolution. They feel
threatened by conflict resolution because they may not get what they want if the other party
gets what they want.
Product Quality does not maintain: This is a huge issue for people getting the wrong things
from the organization. As like one producing building, they have to order all the construction
things from this group. They charging high price but do not give the quality full products like
sands, breeks, tiles and etc.
Conflict Resolution at Work: Bashundara Group having a conflict in the office is another
difficult situation for the employee. Employees do not have any right to progress their work
by themselves.
Unfair with employees: The employees those are working in Bashundara Group are not
getting enough salary for their work although they are getting high profit from their work.
This is not fair for the employees.
Organizational Culture issue: This is element can be a bigger issue in some time. In the
organization model, the organization structure and system are not organizing. They do not
check the cultural program, organization environment for employees or else development
process.
Workforce does not have knowledge: It is not designate the grade to which responsibilities
in an organization like have in Bashundara Group which is divided into unconnected works.
The key impression of this organizational design is that complete work is not done by one
individual. It is broken down into steps, and a different person completes every stage.
Listen and formerly speak out: Believe it or not, just listening to an employee‟s issues is
the first and most important step in resolving conflict. You should simply listen to all parties
involved to completely understand the nature of conflict, and then start troubleshooting
solutions.
Gather the Group: SFC manager will need to arrange a meeting with all involved parties to
discuss the issue. Give everyone a chance to speak; this is a good opportunity to hear all sides
and gain a full understanding of the conflict. Having a group meeting may also expedite a
resolution that will satisfy everyone.
Be Neutral: Don‟t take sides, in a leadership position, shouldn‟t display any sort of opinion
that favors one person over another. If manager is partial towards one individual, try to access
the situation from all sides to come up with a fair and reasonable solution.
Recommendations
Strong distribution channel: Bashundhra group cannot distribute properly their all the
product outside the Dhaka. If they improve their distribution channel, they can serve their all
the product in whole Bangladesh.
Outsourcing: The Company can do outsourcing for their organization. It can help the
organization to work fast and save cost according to company‟s need.
Maintain quality with low price: The organization should maintain their product quality
with low price in market. Sometime their products price is higher than their competitor.
Create loyal customer: They can create loyal customer where switching cost will be so high
so that customer cannot switch another company.
Increase sales and promotional activity: Most of the rural people cannot know about their
some of product like Bashundhara atta, suji, oil etc. those are essential for us. We use this
type of product in our regular basis life. They should increase their promotion activity in
those people who are not familiar about their product to increase sales.
Chain of command should be strong: Due to strong chain of command, employees cannot
work perfectly. They are more careless about their organization. As a result organization
performance hamper. All the employees should more respectful to their boss.
Prevent Self-dealing: The employees of the organization should avoid company‟s property
for personal purpose. If senior‟s employees do this, new employees also do same thing which
is totally unethical.
Feedback loop: Most of the time, top level management take major decision without
discussion with functional level management. That‟s why they face information gap between
top level management and functional level management. They can overcome information
asymmetry.
Human resource management system: They should improve their human resource
management system. Most of the time their recruitment policy on daily newspaper based.
They can come up with online portal which is easier for both applicant and organization.
Conclusion
Bashundhara Group is the biggest corporation in our country. From above discussion it can
be said that the corporation strategic plan is effective. Now-a-days it wants to capture foreign
market by producing quality products. Bashundhara City wins “Superbrand”.