Company Analysis: The firms products will reduce pollution in the environment specifically in UAE and will enhance the world’s developing communities’ performance that are working in the region of Middle East through application of wind and solar energy technologies. If the project is well implemented the firm will turn out to be the world’s leading firm in production of alternative sources of energy services and pollution control products, with its projects dominating in all the seven continents in the next three years.
Industry analysis: Almost 98% of UAE’s population that has access to electricity. Many of these individuals live in the rural remote regions. In reference to Global development, it is a well equipped industry that is capable of funding different development projects in league with the World Bank. In the last decade, the demand for electricity has grown and developed by 42% compared to the previous decade, and here comes the opportunity. The rate at which Re is growing and being appreciated compared to the fossil fuels is ten times more and it could triple by the time we get to 2020. This production of electricity and later use of electricity in different home and industrial appliances tantamount the increase in global warming, air and environmental pollution.
As an integrator, specialized, and dedicated of RE system designer in developing nations’ communities, this firm has positioned itself to invest in this demanding sector of the economy. The company will position itself firs in Eastern part of UAE so that it can establish itself because the region is development oriented and the establishment period will facilitate time for exploration of the deserts for a new venture (Porter, M., 1998).
Product and Services: the firm is aiming at proving pollution controlling affordable electricity as well as electric products in the region and by so doing; it will help controlling pollution in air and environment of UEA. This will also facilitate the families in the region to purchase pollution reducing and environment friendly products on monthly installments. In addition to this the firm will build an over 10,000 watts wind/solar power station and immediately after the completion, it will target to build a community center. The individuals in the region will purchase it at subsidized rate as a community development responsibility. This power will be used in industries, refrigeration, water pumping in irrigation projects, telecommunication, computing, and households. Community center will also act as an institution for nuclear education which is rare in the region and therefore in will attract students internationally thus developing the spirit innovation and entrepreneurship leading to economic development and better environmental control in UAE. The services offered in the region will also educate, motivate ad enable people to set up new investment projects which will lead overall development by keeping an active focus on globalization and environmental control. With a combination of the above, the firm will boost the both safe environment and economic prosperity in the region.
Marketing strategy: this region’s economic activity is farming and it is practiced by over 2 million people. The region is remote and among these people only 11% have access to electricity because the electricity lines are hardly there. The firm’s target will be servicing the farmers who make over %700 annually; this is because they will be in a position to pay for the services. The firm aims to reduce the basic solar system to $288 annually or $24 monthly. A research shows that the price favorable and fair as well, despite analysis that the people capable of paying for the services are 45% of the total population. Currently most of the individuals in the region used crude fuel or the dangerous paraffin to light their lamps while others use dry cells as the source of power for their batteries. The firm aims to educate this individual’s of the dangers of these kinds of fuel as well as their inefficiencies and this will boost the market of the product and services (Porter, M., 1998).
Development and operations: according to the project plan, in three months the firm will start constructing process. Experts in these fields have been hired to design the station and supervise its construction. A business firm in the region will be given the responsibility to oversee all business activities in the firm, after the firm complete each power station, it will later sell it to customers as pre-package kits.
Summary of offering and Financials to customers: by 2015, solar products financing will bring revenue of about $800,000 of the total income, and total revenue from the project will sum up to over$2.7 million. The firm will spend around $1 million to construct the stations and community centre. All this funds will be generated from various private accredited interested sectors, partnership with an international technology company or non-profit relief agencies willing to penetrate these new markets. Overall the firm will help in the development of the region and promotion of telecommunication and electronic services and products. It will also offer investor equity and develop market access in the grass roots. In short, the firm will develop an investors association with a noble initiative.
This is a project management tool that is used to organize, schedule and coordinate tasks in a project. It stands for program evaluation Review technique. It is a methodology that was developed by the U.S navy in early 1950s in the process of managing Polaris submarine programs. It is similar to Critical Path Method (CPM) a methodology that was developed by the private sector at the same time. Complex projects are planned well using this technique which facilitates them to be performed parallel with other activities. This is because in a project many tasks need attention at the same time and thus the project management ensures that all is perfect by scheduling the activities. PERT is a network that also facilitates randomness of activities, it has the capability to reduce the cost and time to complete the project. Therefore, PERT is a very important element in project Management (NET MBA, Business knowledge center, 2011).
Below is an illustration of a PERT chart:
Gantt chart sample
Calculations using PERT
The three cases selected are
1) The time to implement the plan which is three months
2) Time needed to collect the funds after the plan is complete which is two months
3) The time needed to construct the project which is three months
Let optimistic be 13
Case 1: TE= (13+3*4)/6
Case 2: TE= (13+2*4)/6
Case 3: TE= (13+8*4)/6
Company over view
The company will adapt a local name such as Noor or Barq which mean “energy” or “illumination” in Arabic, this will help in the identification of the firm with the local communities. This technique of using local terms helps in entering the new markets. The firm will aim at spreading environment protection technologies which enhance RE. This term renewable means energy sources that can hardly get exhausted, these includes: wind and solar energy that will always remain helpful in reducing pollution. Worldwide the most used commercial renewable energy technologies comprise of: photovoltaic modules, fuel cells, and wind turbines; the use of fuel cells is increasing day in day out.
Milestone schedule and deliverables
When the team responsible of conducting all the individual activities in a project is at wok, it is very important for the project manager to utilize all the available resources to ensure that all the project’s components are looked at individually. This schedules oversees the processes in the project are well coordinated and all parties keep truck. The schedule guides the project management team or the project leader in breaking down the components into smaller components to facilitate adequate concentration. The milestone schedule also maintains all other schedules as well as milestones and ensures that nothing is left behind.
Milestones in the project
Vision statement- to emerge the world’s developer, creator, and enhancer deployment and growth of techniques touch the advancement and development of human civilization in a sustainable environmental condition.
Mission Statement- the firm aims to sustainably and profitably introduce RE in the world’s developing communities.
The Firm’s Current status
The solutions of this firm will be designed like a Delaware C-corporation, the executive office will be located Boulder Colorado in USA, in a period of three months after the establishment. This firm will serve the purpose of an investing, development oriented, and consultancy centre, and will aim to form a partnership organization with communities to produce a sustainable Renewable Energy Project all around the world.
The Services and Market
After the establishment the firm will specialize in provision of home appliances and other services related to electricity in the rural communities and societies, and will mainly use two business strategies. First, the firm will sell electric solar system to households and other commercial application by giving people a chance to fund the project with time. The second technique will be offering quality services to its customer by starting up an electrified community centre in the villages. In these centers, the customer will buy products and services crop processing, refrigeration and other telecommunication services such as selling of internet too.
The risks involves in the project
The risks involved in the project are the source of fund but the project manager and as the project team has developed different means raising the required in establishment. Other risks that were analyzed in the process of project development are the establishment period, and competition from other firms with same ideas. All theses loopholes have addressed to individually by coming up with friendly prices, playing part in community development and promoting their economic activities. These strategies have helped the firm in identifying itself with the community and the communities will be ready to up hold it.
Product and service description
Description of service
The firm will provide financing packages for commercial and home –based solar electric products. In reference to the research performed by the team, an average cost of a small or average solar electric product is about $800 in the rural areas; the firm will ensure that such products are available to its customers at a more affordable price.
In East of UAE, the firm will seek to form an organizational partnership with a local company to facilitate the bargaining for legal aspects, marketing, help in operations, together with other crucial aspects in conducting investment. The target company is Columbia Solar Electronics. It was formed in 1999 by an engineer who was also an entrepreneur. The reason behind the partnership is because it’s hard for a foreign firm to conduct a perfect business with strong roots in a developing nation. The choice of this company has resulted from the fact that in the region there don’t exist any firm that has a golden opportunity to establish itself and grow to admirable levels (NET MBA, Business knowledge center, 2011).
Although I the past fifty year the sector of RE ha to proven to be sustainable, the field is still not fully exploited as it has many opportunities lying beneath it. The opportunity must be identified by a firm, where it will be ready to face the challenges in the field and also enjoy the profits from selling these expensive, high quality products to individuals with low incomes who are the majority in the region. For six years, many firms with quality projects have made large profits from investing in the rural areas and ultimately made achieved astounding success. All these projects have helped in the development of their micro credit or financial option (Hamilton, 2004).
Industry and market
The firm being a provider and designer, it will be in a position to compete in this developing. It is small and fast growing sector of large global industry, the sector aims at conserving the environment as well as producing sustainable products. For example, the UAE’s need for electricity have grown by 40% in the last few years and statistics shows that the figure will grow more and more especially in developing nations. This is because new users are emerging at very high rate especially in the rural areas. This has given this sector a green light that in the next few years it will be a sector that will greatly grow because of the wide market of power. Below is a chart showing the changes in the use of fuel. Series 1 represents fossil fuels which are non-renewable while series 2 represent the renewable. The chart show that the renewable are been appreciated day in day out and this facilitates their growth while the fossils are becoming les popular gradually because of the environment effects as well as their cost (NET MBA, Business knowledge center, 2011).
The other strategy that will be used by the company is to privities the firms after they have fully established. This will facilitate its perpetual and the founders will have ample time in developing other new firms I other regions (Disaster Recovery 2011).
UAE is one of the most peaceful regions in Asia, the region has experienced political stability for the past 60years, and the countries are governed by a well designed mixture of kingdom and democracy which is under Arabic influenc. The region is developing at an admirable rate of 6.5% annually; nevertheless, the inflation level in countries like Pakistan is high around 13% unlike India which is 7%. 75% of the power in the region is hydro power which experiences short comings in the dry seasons. With an exception of main states of UAE, which is the most developed in the region, the rest have power confined only in the urban areas. Farming is the region’s main source of income; this creates market for this firm. The power generated by this firm can be sold to the national grid system act as a backup (NET MBA, Business knowledge center, 2011).
Competition technologies:- because solar products are very expensive in the region, they are used by the wealthy. Each and every family would like to have one but they are frequently deterred by the price. Such individuals have implemented other ways of lighting in the communities which may be dangerous, less convenient and may be expensive in the long run. The main competitor o these products is paraffin which is use in lighting kerosene lamps yet they are crude and dangerous, with creation of awareness, the firm can make win the interests of the communities and would ultimately build the market.
Competitor service provider
Apart from CSEW, there is no firm selling these solar products. Therefore, there is also most no any other company to compete with the firm except CSEW. The government of Tanzania is not willing to expand the grid any sooner therefore private sectors comes in cater for the emerging demand.
Target market strategy
In order to make more affordable products, the firm will offer credit sales where families and companies buy products and pay in annual installments. His will helm nay incapable potential buyers to purchase and benefit from the firm’s products. The smallest installments will be $24 monthly or $288 annually, this will favour them s most of these individuals receive figures around twice the amount annually (Hamilton, 2004).
In developing nations, many micro-credit programs have failed because customers have been given the liberty to default their loan. It is extremely hard to both financially and logically to repossess items in undeveloped communities of foreign countries because customers may think you are taking advantage and practicing unfair business. To prevent this problem the firm will introduce pre-financing plans to customers. In these systems, the customers will have to pay for the product before they take possession of it and this reducing the possibility of bad depts. These systems is important because: first people in developing nations do not understand he concepts of credit sales and second, industrialized nations have always allowed businesses and governments in developing world to default their debt. This is because people in these regions are used o receiving free products from World Bank and other developed countries.
Solar electric kits
These kits will be designed to meet the needs of the people in the region. Most household just need power for lighting and may be powering a Radio or a TV. In order to serve the purpose appropriately, the products will be sold pre-assembled. The will be designed to be very simple to the end-user who will perform he installation process themselves. By so doing the number of staff needed by the firm will be greatly reduced. As the communities become more and more informed, they will develop models that can serve more purpose such a powering computers, dishes and refrigerators (Mind tools, 2011).
The price will be positioned s low as possible when still giving a good profit because of the high rate of stock turn over. It is estimated that in the next three years, almost all families will be ready to surrender half of their income to purchase these products.
The company will use the distribution hub or its administrative offices. Most of the products will be shipped from USA or Europe and will get to the region through Dubai or Bahrain or Qatar. In the long run the firm can look for a reliable supplier from other Asian countries too. When a customer clears his/her accounts, they will be thanked and asked to pick the parcel at the firm’s centre. Throughout the year the firm will invite people for free training and workshops, these trainings will help them in handling the product, maintaining, and how to expand their sola systems.
Advertising and promotion strategy
The firm plans to rely on word of the mouth and publicity to promote these financing plans. The construction of the 15,000watts wind/solar power station will be tremendous news and this will help the company in increasing its popularity. The firm will offer employment to ever 100 people and this will also help in the development of roots.
A customer care will be set a every community centre, this is the position where CSEW will be collecting payments. The firm will pay CSEW on contractual basis depending with the sales.
Customers will start their lifetime relationship with the firm after the reception of the first kit. With time they will learn how to use it and understand their potentiality. All he firms operations will be conducted by CSEW and the operational manager of the firm will be the CEO of CSEW.
After all the laying down processes have been completed, after the revising and completion of the business plan, the firm will start looking for grants from different sectors of the economy. There will be need for product development with time and the designing will be done by the firm’s designer (Mind tools, 2011).