Guillermo Furniture Store Scenario Organization, Approval Instructor,

¶ … Guillermo Furniture Store Scenario organization, approval instructor, assignment Write a paper 2,000 words analyzes Guillermo's alternatives. Select alternatives justify recommendation discussing financial business advantages disadvantages solution vs. alternatives.

The Guillermo Furniture Store Scenario

The Guillermo Furniture Store is currently facing severe challenges from the external environment. As competition intensifies and as the forces in the micro and macro environments become more pressing, the economic agent is forced to reconsider its strategic direction. Up to this stage, the furniture store had been primarily operating on manual labor and was emphasizing on high product quality.

While the managerial objective is that of preserving the high quality of the products and services delivered by the Guillermo Furniture Store, its underlying scope is that of creating more positive financial results and as such securing an improved competitive position for the company.

In establishing the future course of action, four alternative solutions were identified, as follows:

The consolidation of the competitive position of the furniture store through industry movements of mergers and acquisitions that secure a better place for the company

The expansion of the Guillermo Furniture Store so that it offers more services, to wider consumer markets and through a more complex managerial model

The purchase and integration of hi-tech machineries and equipments which increase efficiency and production volumes, and finally

The provision of distribution services for a competing furniture company in Norway.

Each of these alternatives is characterized by its own benefits and limitations. For instance, the mergers and acquisitions would mean that the Guillermo Furniture Store loses its independence, comes of depend on the resources and decisions of other parties as well. The expansion would preserve the company's independence, but would imply the need for 24-hour dedication and commitment from the managerial team, and the owner is unwilling to sacrifice his life for this endeavor. Then, in the case of the hi-tech equipments, the financial costs are impressive, whereas in the case of the service delivery, the option is characterized by the furthering of the company from its core operations.

In such a context then, it is believed that the more suitable course of action for the Guillermo Furniture Store is that of investing in the hi-tech equipments. This solution is suitable as it supports operational efficiency, it increases the production volumes, it reduces costs and it supports overall organizational productivity, profitability as well as competitiveness.

The main downside of this alternative is that it would imply high costs, but the costs would be recuperated within the first years of operations. Also, the current economic climate is best suitable for projects of internal development, as demand for furniture is already weak and as the companies have sufficient time and resources to focus on internal development (Nakagawa, 2006). And furthermore, technological development is not only a viable option at this stage, but a real necessity. Guillermo is no longer able to compete with the mechanized works completed by its local and foreign competitors, but has to move on to technologic devices not only as a competitive measure, but as a necessary measure (Schweitzer, 2008).