Strategy diversification approaches and business applications

¶ … Business Strategy of White Cliffs Hair Studio (WCHS) and WCHS's viability succeeding within the medical industry for Non-Surgical Hair Reconstruction Devices

If You Wanted to Know the Future of Small Business, What Questions Would You Ask?"

Fuller 2003, Introduction ¶ 1).

Consideration of Questions

Fuller recounts a mini historical account of "small business from post-medieval times, through the Industrial Revolution to the present day" (Ibid.), in the study, "If You Wanted to Know the Future of Small Business What Questions Would You Ask?." The brawny message encapsulated in Fuller's study's title, which simultaneously depicts a significant study scenario, contributed to the researcher's determination for the proposed study. In a figurative sense, the proposed study "predicts" the future of White Cliffs Hair Studio (WCHS) by asking the right question/s.

Ultimately, through the development of the proposed study, the researcher will relate the determination/s from: Examining the business strategy of White Cliffs Hair Studio (WCHS) and its viability in succeeding within the medical industry for "Non surgical hair reconstruction devices." By examining components contributing to the success of WCHS, the researcher will, in turn, determine the validity of the hypothesis for the proposed study: If White Cliffs Hair Studio succeeds in fulfilling its goal to diversify and expand into the medical industry for "Non surgical hair reconstruction devices," then, along with enhanced opportunities to help patients who experience Alopecia, WCHS will simultaneously obtain the ability to increase its potential to earn more profits.

Research Questions

Research questions contributing to the determination, which will also help to maintain the proposed study's focus, include:

What business strategy does White Cliffs Hair Studio currently employ?

What effect does a business strategy have upon a business and its potential to diverge?

What factors reflect the viability of WCHS to succeed within the medical industry for "Non surgical hair reconstruction devices"?

Background to Cancer and Alopecia Patients

Cancer Concerns number of studies project the concern that approximately one in three individuals will develop cancer in some form during his/her life. Cancer currently challenges more than a quarter of a million individuals in the UK each year. (Office for national statistics 2004)

Alopecia

Alopecia, hair loss, a common side effect of chemotherapy generally begins within several weeks of the patient's initial course of chemotherapy (chemo). his/her hair re-growth, according to studies, typically begins a month after the patient completes his/her chemo treatment (Higgs 1990). In the meantime, cancer patients frequently experience extreme anxiety, with some patients reportedly considering rejecting, and some actually rejecting curative treatment (Tierney and Taylor 1991) for Alopecia.

White Cliffs Hair Studio

White Cliffs Hair Studio, which advertises itself to be, "the UK's leading provider of state-of-the-art hair replacement products and other advanced hair loss solutions" (White Cliffs 2008), reports its mission constitutes: "to improve the lives of those experiencing the trauma of hair loss and Alopecia, as well those who desire to improve their natural appearance"(White Cliffs 2008).

The following figures portray a few of WCHS's clients featured on their Web site (permission to a reproduced these photos for the proposed study; currently in progress).

A www.whitecliffsgroup.com/Images/gallery/1large.jpg"

White Cliffs Hair Studio currently manages the following eight hair replacement studios in the UK:

London Hair Replacement Studio - Mayfair, UK;

London Hair Replacement Studio - London Bridge, UK;

Manchester Hair Replacement Studio, UK;

Bristol Hair Replacement Studio, UK;

Birmingham Hair Replacement Studio, UK;

Leeds Hair Replacement Studio, UK;

Dublin Hair Replacement Studio, Ireland;

Glasgow Hair Replacement Studio, Scotland. (White Cliffs 2008)

In the United States (U.S.), White Cliffs Hair Studio currently manages the following five hair replacement studios:

Cleveland Hair ReplacementStudio, OH;

Indianapolis Hair Replacement Studio, in;

Chicago Hair Replacement Studio, IL;

Los Angeles Hair Replacement Studio, CA;

New York City Hair Replacement Studio, NY. (White Cliffs 2008)

In India, White Cliffs Hair Studio currently manages the following five hair replacement studios: Chennai Hair Replacement Studio, India; Hyderabad Hair Replacement Studio, India; Bangalore Hair Replacement Studio, India; Mumbai Hair Replacement Studio, India. In Canada, WCHS opened Toronto Hair Replacement Studio, Canada, its first hair replacement studios, on November 1, 2008. WCHS currently operates two hair replacement studios in Australia: Sydney Hair Replacement Studio, Australia, and Melbourne Hair Replacement Studio, Australia. The Sri Lanka Hair Replacement Studio, in Sri Lanka advertises White Cliffs Hair Studio, its founder, as the "Best Hair Replacement in Europe" (White Cliffs 2008).

Significance of the Proposed Study

The proposed study firstly proves significant for the research as it serves as the forerunner for the full dissertation mandated for the awarding of the researcher's future degree. Secondly, after the researcher completes the forthcoming dissertation, the knowledge obtained during the proposed study's effort will have increased the researcher's understanding of the subject of hair loss replacement for patients who experience Alopecia, as well as enhance the researcher's future capabilities in the career in the chosen field / subject.

Study Structure for the Proposed Study

The following five chapters will constitute the body of the proposed study:

Chapter I: Introduction

Chapter II: Review of the Literature

Chapter III: Methodology

Chapter IV: Analysis and Findings

Chapter I: Discussion, Conclusion, and Recommendations

Aims and Objectives

Fulfilling the primary aim for the proposed study:

Examining the business strategy of White Cliffs Hair Studio (WCHS) and its viability in succeeding within the medical industry for "Non surgical hair reconstruction devices," mandates the following the objectives be addressed:

Objective one: Examine the business strategy White Cliffs Hair Studio currently employs.

Objective two:

Thoroughly review current literature regarding the effect/s a business strategy may have upon a business and its potential to diverge.

Objective three: Identify factors that reflect the viability of WCHS to succeed within the medical industry for "Non surgical hair reconstruction devices."

In turn, as these objectives are fulfilled, along with the analysis of the retrieved researched information, the hypothesis for the proposed study will be determined: If White Cliffs Hair Studio succeeds in fulfilling its goal to diversify and expand into the medical industry for "Non surgical hair reconstruction devices," then, along with enhanced opportunities to help patients who experience Alopecia, WCHS will simultaneously obtain the ability to increase its potential to earn more profits.

During the next segment of the proposed study, the propose literature review, the researcher relates a sampling of information to be retrieved during the forthcoming study.

CHAPTER II: LITERATURE REVIEW

Strategy is about making choices some of which appear to be riskier than others"

Parnell 2003, ¶ 28)

2.1: Introduction Literature relevant to the proposed study initially included a review of approximately 50 sources, specifically exploring information for connections to three broad themes. Focus for this literature review segment will aim to support this study's research questions, fulfill objectives noted in the introduction for this study, and ultimately contribute to the determination of the hypothesis for the proposed study. The hypothesis, as noted in the previous chapter, purports: If White Cliffs Hair Studio succeeds in fulfilling its goal to diversify and expand into the medical industry for "Non surgical hair reconstruction devices," then, along with enhanced opportunities to help patients who experience Alopecia, WCHS will simultaneously obtain the ability to increase its potential to earn more profits.

To help the researcher maintain focus and..., this study adheres to a thematic organization, while exploring the following three themes:

White Cliffs Hair Studio's current business strategy,

New Business Strategy, and Contemporary Issues.

2.1: White Cliffs Hair Studio's Current Business Strategy

Both founders being hair loss sufferers, they had a dream to make a Hair Replacement and Hair Re-Growth company that was radically different: one based on people-first (not profit) and innovation. Warren and Andrew's passion gave rise to a whole new way of thinking for the industry: based on Trust, Compassion, being Customer-Dedicated, that would offer clients the style andcreativity that Mayfair London is famed for, and would provide world-leading solutions within one "Sanctuary."

That "Sanctuary" became WHITE CLIFFS- a friend, advocate, and place where real solutions that work are offered, hair loss sufferers' needs are understood, their best interests taken to heart, and where they are never just a "number." Like its namesake the WHITE CLIFFS of Dover, WHITE CLIFFS Hair Studio is about the classic British values of Trust, being Reliable, Beauty/Creativity, Fair Play, Innovation, and always being there for our clients.

Our expertise is world renowned and our clients come from all walks of life from global movie stars and celebrities to shopssistants. The common bond between all of our clients is they love beautiful hair and have a desire to have their hair back - as natural as possible, allowing them to live life normally... To get back in the game of life.

For WHITE CLIFFS, every client is an opportunity to improve someone's life and to prove that we are "The Better Way."

Hair Loss Therapy

WCHS utilizes low-level laser hair loss therapy, which according to studies, confirm the following "selling points" the company relates to respective clients, for this particular treatment, reported to be effective "for most forms of hair loss, including male and female pattern baldness" (White Cliffs 2008):

More than 90% of users achieve some positive benefits and results.

More than 44% of users see noticeable indications of benefits from laser treatment within the first 6 weeks.

Another 45% see results in 6 to 12 weeks.

The remainder sees less dramatic results after 12 weeks. (White Cliffs 2008)

2.3: New Business Strategy

Parnell proposes a number of questions regarding business strategy, including "Is strategy-making an art or science? Should a strategy be publicized or kept largely secret? Is consistency or flexibility more important? Should risk be embraced or avoided? Should the planning process be top-down or bottom-up?" (Parnell, ¶ 28). As answers, however, frequently are not as concrete as the questions in regard to a business strategy, addressing the following issues, Parnell contends, will likely help a business link a strategy to its particular environments and endeavor/s and environment" (Parnell, ¶ 28).

Parnell recommends businesses consider the following information:

Strategy is about making choices...some of which appear to be riskier than others. Environmental scanning is at best an inexact science, and strategic managers are inevitably left with varying amounts of risk associated with each strategic alternative. According to one school of thought, however, top managers should not forego attractive opportunities because of a lack of certainty. A second school contends that risk reduction is the primary responsibility of top management. Executives, therefore, should be skilled at processing information so that risk can be avoided -- or at least severely minimized -- in strategy formulation. Risk, they argue, will inevitably lead to failure. (Ibid)

Business Strategy Types and Innovative Practices in "Business Strategy Types and Innovative Practices," Tim Blumentritt and Wade M. Danis examine a number of ways several firms utilize various strategic orientations to manage their business practices. From their expiration of ways firms with contrasting strategic orientations view particular issues, they note, "One key to successful strategic management is the ability to achieve fit or coherence among a set of competitive factors, both internal and external to the organization, in a manner that facilitates high performance" (Ibid.). According to the strategic choice perspective, organizations do not merely respond to environments; through strategic actions of top managers they dynamically interact with their specific environments.

Mission Statement mission statement 'tells two things about a company: who it is and what it does'" (Williams 2008, ¶ 1) According to Linda Stallworth Williams (2008) in "The Mission Statement: A Corporate Reporting Tool with a Past, Present, and Future," "mission statements still serve as common corporate reporting tools" (¶ 1).

As the introductory statement for this section notes, a mission state also reveals two primary points about a company, basically "who" it purports itself to be, and "what" it accomplishes as a company. Components contributing to a company's mission statement could identify the company's: customers; primary products and/or services; location; basic technology; survival concerns; philosophy; self-concept; vital strengths; competitive advantages; public image considerations; concern for employees (Williams, Content Analysis section, ¶ 2)

All Businesses were Once Small Businesses

Even the most massive business in the world started out as a small business. Businesses start as they offer an improvement to a service for product, and/or fill a unique need.

Fuller points out that if the business's offering proves to be "of significant benefit to many, the business may grow quite large, supported by infusions of funds" (the trajectories section, ¶ 17). As businesses recognise unmet needs and possess freedom to mobilise their activities and resources to meet needs, new businesses will continue to emerge and possess the potential to one day, perhaps diversify and become a major business in the global environment.

Kannan Ramaswamy, Mingfang Li, and Rajaram Veliyath (2002) note the following regarding a business's consideration to diversify in their study,"Variations in ownership behavior and propensity to diversify: A study of the Indian corporate context":

The relationship between ownership and diversification has been the focus of renewed debate between financial economists and strategic management scholars. While financial economists hold that manager-controlled firms tend to reflect higher levels of diversification, strategy researchers argue that ownership and diversification are not systematically related... Findings show that diverse ownership groups adopt different postures in monitoring and/or influencing organizational diversification. While some ownership groups are closely associated with focused strategies, and some encourage diversification, others are quite indifferent. These results suggest that the context-specific variation among ownership groups is germane to our understanding of diversification strategy. (Kannan, Mingfang, and Rajaram)

Other Studies to Be Explored

The following three abstracts reflect a sampling studies the researcher plan to explorer more fully during the course of completing the forthcoming dissertation.

Research on corporate diversification: A synthesis," by Vasudevan Ramanujam and P. Varadarajan (2006):

Diversification has emerged as a central topic of research in strategic management. Although this topic has been widely and intensively studied by scholars from other areas such as industrial organization economics, financial economics, organization theory, and marketing, a synthesis of these diverse streams of research is lacking. This paper attempts such a synthesis with a view to fostering further strategic management research in this area by taking a multi-disciplinary perspective on diversification. A wide-ranging search of the literature led to the development of an overarching research framework that facilitates the classification of a vast body of literature. Proceeding from the framework, a critique of the literature is performed with a particular emphasis on studies by strategic management researchers. Five key conceptual and methodological problems are identified and discussed. Suggestions are offered for future research on diversification. (Ramanujamand Varadarajan)

In "Diversification, Ownership and Control of Swedish Corporations." John a. Doukas, Martin Holmen & Nickolaos G. Travlos (2002), report the following:

We study the short? And long-term valuation effects of Swedish takeovers. Using a sample of 93 bidding firms that acquired 101 targets between 1980 and 1995, we find that diversifying acquisitions lead to a negative market reaction and deterioration of the operating performance of the bidder. Announcement and performance gains in each of the three years following the acquisition occur only when bidders expand their core rather than their peripheral lines of business. Our findings suggest that focused acquisitions lead to greater synergies and operating efficiencies than diversifying acquisitions. Intra-group acquisitions, however, show that bidders do not realise significant gains whether they adopt diversifying or focusing investment strategies by purchasing firms controlled by the Wallenberg and SHB conglomerate groups. Intra-group targets realize significant gains regardless bidder's investment strategy. Finally, the evidence does not support the view that intra-conglomerate acquisitions are associated with expropriation of minority shareholders. However, they appear to enhance the control rights of large shareholders of the bidding firm.

Ithai Stern, and Andrew D. Henderso examine Within-business diversification in technology-intensive industries":

While prior research suggests that corporate-level diversification accounts for relatively little variation in performance, within-business diversification matters a great deal, by influencing which start-ups survive and which firms better cope with rapid environmental change. Specifically, we find that the relationship between within-business diversity and survival is contingent on the amount of environmental change wrought by a firm's competitors as they simultaneously diversify their own product portfolios and innovate technologically. Analysis of the population of U.S. personal computer manufacturers from the industry's founding in 1975 through 1994 supports our premise: Regardless of its effects across businesses, diversification matters a great deal within them.

2.3: Contemporary Issues

Cancer Survivor Challenges

In "A Support Group Intervention to Facilitate Young Adults' Adjustment to Cancer," Cleora S. Roberts, Lori Piper, John Denny, and Gary Cuddeback (1997) purport that studies, as well as numerous clinical observations confirm that when diagnosed with cancer, young adults frequently experience extreme psychological disturbance. One study revealed that young adult cancer survivors regularly encounter at least six of the following life changes and challenges.

A anxiety about health, loss of physical well-being, worry about children, problems in relationships, financial and vocational concerns, and feelings of unattractiveness (www.questia.com/PM.qst?a=o&d=5000452557"Roberts, ¶ 2)

Cancer treatments create life changes that disrupt the normal psychological and social developmental tasks of young adulthood" (www.questia.com/PM.qst?a=o&d=5000452557"Roberts, ¶ 6)

Cancer, a primary, contemporary concern contributing to morbidity, affects more than a quarter of a million individuals in the UK each year as they are newly diagnosed with the disease. Some researchers predict that approximately one in three individuals will develop cancer in some form during his/her life. Researchers have identified approximately 200 various types of cancer, however, only four of these forms: "Breast, lung, large bowel (colorectal) and prostate - account for over half of all new cases," with breast cancer ranking as the most prevalent cancer diagnosed in the UK (Office for national statistics 2004)

Older individuals predominately develop cancer, with 64% of confirmed cancer cases being diagnosed in individuals 65 years old and over. The following statements denote three recent findings from studies in regard to cancer:

Cancer occurs in "less than 1% in children (0-14 years)";

Women in their 30s 40s and 50s possess higher risk factors for developing cancer than men at that same age, primarily due "to their excess risk of breast cancer with it accounting for 50% of the women aged 40-60 years."

Currently, approximately 2% of the UK population (1.2million people), alive in the UK, have received a cancer diagnosis. (Ibid)

Alopecia

Alopecia, hair loss, a common side effect of chemotherapy, contrary to the historical association of luxuriant hair as a symbol of strength, health, and sexual charisma, merits perceptions of the affected individual to be aging; ill and/or losing his/her attractiveness. One recent, comprehensive exploration of the literature regarding hair loss that occurs during cancer chemotherapy, purports: "Historically, shaving of the head has often been associated with mourning or entering a religious order. Enforced cutting or shaving of the head even in modern times is employed as a sign of contempt and degradation" (Batchelor 2001). Some individuals stress they would prefer to suffer and die of cancer related pain of than to experience the humiliation of losing their hair. In line with the thought of contempt, a number of incidences have been related of patients refusing chemotherapy treatment due to the threat of hair loss, which typically starts within the first few weeks of the patient's initial course of chemotherapy (chemo). Hair re-growth, according to studies, typically begins a month after the patient completes his/her chemo treatment (Higgs 1990). Reports indicate that CIA (chemo induced alopecia) may contribute to some patients experiencing such extreme levels of emotional anxiety they consider rejecting or actually reject curative treatment (Tierney and Taylor 1991). Forty-seven percent of patients participating in one survey reported they considered CIA to be the single worst side-effect of their cancer treatment (Munstedt et al. 1997). Medical and nursing staffs, however, often inured to the sight of bald patients; consider Alopecia worth the temporary emotional pain (Massey 1994). Approximately one in six phone calls to Breast Cancer Care helpline, an organization which provides cancer support and information, relates to hair loss and its implications. Typically, females experience more psychological distress than males, as adult males appear to be able to cope more easily. Perhaps this fact relates to society will really accepts the fact of male baldness, even in young males (Batchelor 2001). This easy assumption, albeit, may be questionable (Baxley et al. 1984), as even male children are particularly vulnerable to the stigma of sudden hair loss (Reid 1997).

Patients routinely wear wigs when they experience Alopecia, a usually reversible condition. The National Health Service (NHS) frequently makes wigs available to patients receiving treatment. One initial study examining the "body image" of patients found that even though subjects experiencing Alopecia frequently decreased social activities, compared with individuals who did not experience Alopecia, possibly due to the patients' ability to adapt to the change, hair loss produced an unexpectedly small effect on the patient's body image (Wagner and Bye 1979). Sufficient first-hand testimony, nevertheless at least to the initial trauma of sudden and dramatic hair loss, (Clement Jones 1985 cited in William et al. 1999) allocates the need to feature this consideration in any psychological assessment of a cancer patient (Eh-Mann et al. 1991, Nicoloas and Veach 2000). Even those individuals specifically prepared for hair loss, however, may be left feeling unprepared by Alopecia. One such adversely affected patient recounts: "All of a sudden,...one day, you go into that shower, and you start to wash your hair. And then you come out and you have no hair. And the hair is all over the shower, the tub, the walls, the hands, your body, I mean you just can't....That was the most traumatic thing in the world" (Williams et al., 1999, 1465).