Strategic Plan
Centrica is a large multinational company based in UK which is known and trusted by millions of consumers. It remains the largest residential supplier of gas and electricity in UK. It is also the largest domestic central heating installation and maintenance company.
Corporate Objectives
The long term objectives of Centrica are summarized as: to expand the business agressively and offer above average returns to stakeholders and to be tnimber one or two leading supplier of gas and electricity in UK and internationally.
Corporate Goals
Centrica’s key targets will be achieved over the next 3-5 years are as follows: increase operating profit by 60%, operating and overhead costs reduction, achieve an expansion of efficient infrastructure, achieve a develop system and improved process, become the largest supplier of gas and electricity over Europe, and employ fully qualified employees and engineers.
SWOT Analysis
From the objectives of the Centrica, SWOT Analysis is used to measure organization’s internal strengths and weaknesses and external opportunities and threats. This shows a representation of where the company is at point in time in relation to its environment. SWOT starts off with investigating the internal factors that support the company (strengths) and the internal factors that have a negative impact to the company. Then after that, investigating the external opportunities which the company may have and its external threats follows through.
SWOT is limited only to looking at the internal strengths, weaknesses and external opportunities and threats but it fails to consider the economical and social trends. The strengths of Centrica are its strong financial performance and its dedicated and professional employees. The weaknesses are high prices on commodity, lack of upstream gas assets, customer losses, undeveloped system and unimproved process, and high operational and overhead costs. The opportunities of Centrica is diversification, they can also go into vertical integration and even internationalization. The main threats are competitive marketplace, volatile market conditions, and the additional supplementary tax on gas production profit.
Key Strategies
Centrica’s strategic priorities are the following: rigorous cost reduction across the Group to allow lower prices on the commodities, proactive marketing to strengthen customer loyalty and cope up again the large customer loss from this year, positive price management to sustain profitability, building growth in our service and energy businesses at home and abroad, and absolute financial discipline in acquisition and capital investment.
Strategic Action Programs
The following strategic programs will be implemented:
A. CEO: Prepare comprehensive business plan
B. HR: Recruit Marketing Director and other key staff for marketing and sales
C. HR: Train newly recruited staff
D. Board: Expand BOD to include further independent financial, technical, and industrial expertise
E. Director of Development: Prepare a development plan for power station infrastructure
F. Director of Development: Present to CEO for approval
G. Director of Development: Start the infrastructure building
H. Group Managing Director: Seek out new markets in Europe for further expansion
GANTT Chart
Shown below is a Gantt Chart to show when the task should be completed. It is a useful tool for planning and scheduling projects. It assesses how long a project should take, determine the resources needed and lay out the order in which the task need to be carried out.
Table 1 : Gantt Chart of Centrica’s strategic action programs
In the Gantt Chart above, it shows that Program A which is preparing the business plan should be done by the CEO in 6 months time. In the Program B, the Human resource should recruit new marketing personnel in 4 months time and train them in just 2 months. Next is the Board should extent the Board of Directors in 2 years. Then to expand their infrastructure, the Director of Development should prepare a development plan for 10 months. After having the development plan it should go to the CEO for approval. After approval, the project should start up immediately and finish it in 4 years. And also the company should seek out new markets for further expansion and should start out looking out immediately after a business plan is completed and would end within 5 years and hopefully by the end of five years, Centrica has already new markets within Europe or in other countries or continents rather than Europe to start with the business expansion.
Gantt Chart are also useful when the project under way. It helps in monitoring its progress and immediately see what should have been achieve at a point in time, and can therefore take remedial actions to bring the project back on course.
References:
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