SWOT analysis and organizational design of Tanner AG

Tanner AG

ECONOMICS

Design of a Customer Based

Organization for the TANNER AG

Tanner AG was founded by Helmut Tanner in 1984. This report aims to assess some aspects of the company through SWOT analysis. Since its inception, TANNER AG has consistently raised revenues and has grown into an international conglomerate that has become a force to be reckoned with in the international technology market. As per the company Web Site, TANNER AG focuses on several technological areas:

Technical documentation

Product catalogs

Editorship and catalog systems

Electronic spare parts catalogues

System integration

Process optimization

In an era where technology is offered by far too many businesses, TANNER AG has found its niche and will therefore continue to prosper.

Design of a customer-based organization for the TANNER AG

Introduction

This paper attempts to understand the success and future potential of TANNER AG, a stable global operation that has shown that it can be successful at a time when other global organizations have been less productive. With an additional focus on organizational theory and design, this report will define the TANNER AG and examine the internal and external business environment by analysis of potential opportunities and threats. By reviewing the company from a perspective of its life cycle, macro environmental trends, competitors, strengths and weaknesses, the report can present an insight into TANNER AG. In addition, the paper utilizes a 'customer-based organization' approach to understanding TANNER AG. The information gathered on TANNER AG was gathered through various techniques including the Ten Commandments of case analysis, ESP-TE, PETR-PEC and AM-FAMUS. The report tries to therefore present TANNER AG's strategic and long-term plans, criteria objectives, and other key data factors through statistical information and models. The report is presented in a SWOT analysis format to abridge the presentation even though factors such as organizational strategies and strategic alliances have also been incorporated.

Theoretical aspects of Organizational Design

Modern international organizations have had to reevaluate and apply theoretical and design principles in our highly competitive technologically advanced global business environment. And these rules have applied to both the public and private sector organizations around the world. TANNER AG is no exception. TANNER AG and the many other businesses the world over have had to improve their skills in analyzing marketing situations, identifying market opportunities, developing marketing strategies, making concise recommendations, and defending those recommendations. With new available information technologies, designing, manufacturing selling and marketing any consumer good will be radically different than even just a decade ago.

TANNER AG and the like have had to apply new techniques to target and reach the proper market segments, gather timely marketing research data, analyze it electronically and monitor a plethora of marketing process functions that can be associated to approaches like integrated World Wide Web sites. Consider that this business environment has had a wide and varied impact on organizational strategies of variable environments that different nations require. Quality of work life with other societal attitudes is just one example of how the business climate has changed.

Organizational theory and organizational design types are mainly concerned with a company's structure. The concepts of the degree and type of horizontal differentiation, vertical differentiation, mechanisms of coordination and control, formalization, and the centralization of power all are key factors in creating a successful business structure. Some believe that that there is no single way to organize a company its structural attributes. Companies such as TANNER AG attempt to align the organization's structure, size, technology and both social and stakeholder obligations as best they can. This approach for organizational theory is known as the contingency theory.

By size, one must evaluate the capacity, personnel, outputs for customers, sales and other company resources. Firms have to understand that increasing size of any function also increases other structural capabilities. In addition, an increase in size or an expansion into a new nation's market also decreases the concentration of power and management. Profit or meeting social obligations are often the concepts organizational theory and design must address. Therefore, technology has become instrumental in the organizational theory and design because of its ability to force specialization, divide labor and to centralize decision-making.

There are many ways to identify types of business from either a legal or business perspective. For example, a sole proprietorship, a partnership and a corporation are all types of business structures and they all have advantages and disadvantages. The key is to structure the company so that it can best benefit from whatever organizational type is implemented. For example, companies that produce a one-of-a-kind custom product like a small wood stove producer may need a structure that gives the boss a low span of control, few managers and direct reports and final say to avoid bureaucracy. Here, individual skills are crucial than deep levels of management. but, TANNER AG is a large international conglomerate that produces and sells huge volumes of identical products so they require a much larger organizational hierarchy that accepts a bureaucratic structure.

How it works

Tanner Translations GmbH+Co (limited company; fully liable company is the Tanner Translations Verwaltungs GmbH), TANNER AG holds 50% of the limited company and 49% of the fully liable company. Tanner Dokuments Munchen GmbH+Co (limited company; fully liable company is the Tanner Dokuments Munchen Verwaltungs GmbH), TANNER AG holds 80% of the limited company and 99% of the fully liable company. Tanner Consulting GmbH+Co (limited company; fully liable company is the Tanner Consulting Verwaltungs GmbH), TANNER AG holds 100% of both companies. Internationales Hochschulinstitut fur Weiterbildung, Lindau / Bodensee gGmbH, Lindau

TANNER AG holds 14,2875% (10.000 €) of this post graduate education institute. Concerning the ownership of the "Aktiengesellschaft" (AG - public limited company), the company is not placed on the stock market. The owners of the shares are: Helmut Tanner 1978 shares (46%) Founder and Chairman of the Board; Edda Tanner 774 shares (18%) Chairman of the Supervisory Board; Harald Litz 774 shares (18%) Senior Designer at TANNER; Thomas Abele 774 shares (18%) External shareholder (former Managing Director of TANNER)

SWOT

Strengths

Every organization has some strength. TANNER AG's strength begins with their mission to make technology transparent. They as an organization strive to be the Europe's number one technical documentation, technical catalogs and information management company. The company's strategy also creates an environment that is customer driven.

TANNER AG has a considerable advantage in the spectrum of expanding market share through competitor displacement. The company has researched the potential of Germany's one billion € market for creating technical documentation. The market is currently shared by many other full-service technical documentation service providers or agencies and engineering consultants. These types of competitors can match the strength of personalized business services that TANNER can produce.

For example, almost 70% of German companies do not have in-house divisions for technical documentation. This provides a vast opportunity for TANNER AG. They can offer outsourced documentation which will free up internal resources to concentrate on their core competencies. The same holds true with the document leasing aspects of the business that can add value for customers and also create secondary markets for TANNER.

Weaknesses

Every organization has some weakness. As a service provider, TANNER AG technically has no products to sell. Therefore, reputation and past experience are a key aspect of future sales. Because no product alterations can be made when something goes wrong, TANNER is susceptible to customers moving away from the brand name or simple creating their own substitute service.

Opportunities

All organizations have some opportunities. In business, numbers equate to success - or failure. TANNER AG must continually focus on sales and marketing in order to survive. The tenet 'no customers = no business' will continue to be true no matter technologically advanced society gets. Therefore, success will continue to be a 'customer-based organization' that attracts and retains new customers. Marketing and selling work hand in hand so new marketing initiatives coupled with successful selling strategies that apply the principles of the four P'are in order:

Product

Price

Placement

Promotion

Technology driven transparent documentation is the product. TANNER AG must learn to listen and communicate the needs of potential customer to verify if the product is keeping up with the demand. TANNER AG continues to enjoy pricing advantages over its competition, but new technology could easily take that advantage away. Therefore, new Research and Development opportunities must continuously be sought after to help maintain pricing for the future. From the promotional and placement perspective, TANNER AG must utilize new marketing approaches that incorporate modern word of mouth and buzz marketing techniques that personalize the promotional experience.

Threats

No organization is immune to threats. Just as technology was the foundation for the organization in 1984, new technological breakthroughs could just as easily bring the mountain to TANNER. It is a critical mix of relying on existing technology with being overly dependent on old technology. TANNER must contemplate its future as new innovations alter our global business spectrum.

Conclusion

In conclusion, this paper attempted to understand the success and future potential of TANNER AG. Since 1984, the organization has maintained steady growth and has been a very stable global operation when other industry players have been less productive. With an additional focus on organizational theory and design, this report defined TANNER AG and examined the internal and external business environment by analysis of potential opportunities and threats. The information gathered on TANNER AG was acquired through various techniques including the Ten Commandments of case analysis, ESP-TE, PETR-PEC and AM-FAMUS. The report tried to therefore present TANNER AG's strategic and long-term plans, criteria objectives, and other key data factors through statistical information and models. The report was presented as a SWOT analysis format to abridge the presentation