Understanding Contemporary Organization of EMP †Free Samples

Question: Discuss about the Understanding Contemporary Organization of EMP. Answer: Introduction EMP is a multinational gold company which has its headquarter in Australia and is one of the listed companies in the Stock exchange. The mines of the companies operate successfully in five countries. The company has substantial gold reserves that will provide 30 years of production. As per the financial forecasts, the company will generate good cash margins by providing high quality gold assets. The main emphasis of the company is long-term value creation, which will be done by reducing the costs, increasing the reserves and production with the help of efficient use of capita (Joyce Paquin, 2016). The company has seven mines that are managed separately as profit centers. EMP also operates through joint ventures and currently the company has two mines of joint ventures in Asia and South America. Discussion: Business Canvas Model Key partners Suppliers, who provide mining equipments and tools and vehicles like trucks used for mining and exploration distributors, local and national authorities Key activities Spanning, exploration, mining and marketing of the finished products Value Proposition Focus on each stage of production. Increasing gold reserves and cost effectiveness Customer segments Merchants, local and international smelters, customers of Australia, Asia and Europe Customer relationships Focusing on quality and ensuring the customers to provide the best quality Key Resources Tools used for mining, drilling, exploration, trucks, funds and skilled labor force Channels Cost structure Salaries, wages, cost of equipments and tools, cost for operations like exploration, mining and spanning Revenue Streams Selling the finished gold products to the five countries where the company operates. Key partners- Key partners of the company are the suppliers who provide vehicles and trucks for mining activities, suppliers, who provide equipments used for the mining. Gold concentrates are transferred to the refineries and smelters for further refining and smelting. The owners of these refineries and smelters are the partners of the company. The lawyers are the legal partners who would help in legal matters like licensing that are required for any business. Other partners include distributors who would be distributing the processed gold product to the end users. Key activities- The activities start with finding the right site that is rich in the gold ores. Another major activity is setting up the site for routine mining activities. Generally, the refining and smelting of the washed ores are done in separate refineries. Finally, the gold ores are processed to make finished gold that can be sold or further used for other purposes (Shafritz, Ott Jang, 2015). Key resources- The key resource of the company include, land that is rich in gold ores, mining equipments, vehicles like, trucks, fund to hire employees. Since the mining activity is both capital and labor intensive, adequate amount of funds and labor are required for carrying out the mining activity. Apart from the manpower required at mining site, a large number of skilled employees are required for carrying out smelting and refining activities. Therefore, skilled workforce is required at refineries as well. Value proposition- The company creates value by focusing on quality, which is gained by focusing in each and every step that is involved in the processing of the gold ores. EMP believes that building good relationship with the employees should be built on mutual trust. They have in total six thousand employees all around the world. The core value of the organization is to focus on health and safety of the employees at the mining sites (Kotler et al., 216). Creating a good will in the market is the prime objective of the company. Customer segments- The main customers of the company include smelters in Australia, Asia and Europe. They also sell their products to the merchants who are in contract with the company (Cummings Worley, 2014). Channels- The distributors of the company transfer the gold to the smelters (Cummings Worley, 2014). Customer relationships- The Company has established a good and healthy relationship with their customers, like the merchants who are in contract with the company (Joyce Paquin, 2016). Cost structure- Cost structure of the company comprises of equipment costs, trucks, drilling tools, tools used for exploration, monitors for monitoring. The salaries and wages of the employees and labors all constitute to the cost structure. Revenue streams- The company generates revenue from the selling the gold products to the merchants and smelters in Asia, Europe and Australia (Joyce Paquin, 2016). The organizational design of the company is divisional, as shown in the figure, each of the seven mines of the company operate as strategic business units, so it can be said that the company has seven strategic business units. Each of the divisions has separate marketing, human resource, operations and finance departments (Armstrong et al., 2015). Marketing management Each of the seven mines of the company are separate profit centers, therefore each of the business units have their own department for marketing management. The company implements marketing strategies based on the country it is operating. The focus of the company is value creation for which the company is continuously focusing on quality that it provides to its customers. For fulfilling the demand of its customers, the company is also focusing on exploration to find new gold reserves. The customers of the company are merchants with whom the company has signed contract. Majority of the production of the company is transferred sold to the smelters in Asia, Australia and Europe (Armstrong et al., 2015). To find new gold reserves that are a complicated task, therefore the company is finding new and innovative ways for explorations. The company for its production efficiency focuses on all the stages of production, spanning, exploration, mining, operation, processing and research and devel opment. Another most important strategy of the business is reduction in costs. Large open pits and underground mining technology is used for mining so that the cost can be controlled. Each of mines ship their transformed ore to gold concentrate to smelters for final refining. Cost reduction and increasing the gold reserves are some of the main strategies used by the company for gaining competitive advantage in the market. The company can apply skimming pricing strategy because the cost involved in the production of the product of the company is too much. In order to cover that cost the company can target the premium clients and apply skimming pricing strategy. The advertising of the gold products can be done in premium magazines. For promotional activities more emphasis should be given to direct marketing and personal selling. Finance management Each of the mines has their own finance department and they handle the financial transactions separately. The working capital of the company comes from the revenue it earns by selling the gold products to the customers and merchants. EMPs strategy is to keep the operational cost minimal so that the company can have a cost benefit. EMP plans to use the capital efficiently in each of its operations and activities (Arnold, 2013). The company operates in five countries and through the sales from all these countries, the company gets a major portion of its revenue. Relation between marketing and finance department Marketing and finance department are very much independent, the finance department maintains the revenue generated by the marketing department. Finance department handles all the expenditure that are required for carrying out the various activities whereas marketing department carries out all the activities that are either directly related to revenue generation like, sales or support sales, like promotional activities. All the four departments are crucial for any business organization but it can be said that marketing and financial departments are backbone of any organization (Brigham Ehrhardt, 2013). The main source of revenue in the company is the sales of the gold products to the customers across the world. The revenue generated is further used for various operations and providing wages and salaries to the employees. The finance department keeps an account of all the income and expenditures of the company. It allocates funds for carrying out various activities. Conclusion Thus, it can be concluded that the strategy adopted by the company to capture maximum market share is very effective, because the company is not concentrated to one country rather it is operational in five countries where the company has separate functional departments. The divisional organizational design of the company helps the company to operate easily in each of the seven mines as separate profit centers. The gold reserves of EMP will provide 30 years of production to the company. The focus of the company is long-term value creation, and so EMP focuses on efficiency in each of the phases of its production. The main strategy of the business is reduction in costs and increasing the gold reserves. References Armstrong, G., Kotler, P., Harker, M., Brennan, R. (2015).Marketing: an introduction. Pearson Education. Arnold, G. (2013).Corporate financial management. Pearson Higher Ed. Brigham, E. F., Ehrhardt, M. C. (2013).Financial management: Theory practice. Cengage Learning. Cummings, T. G., Worley, C. G. (2014).Organization development and change. Cengage learning. Joyce, A., Paquin, R. L. (2016). The triple layered business model canvas: A tool to design more sustainable business models.Journal of Cleaner Production,135, 1474-1486. Kotler, P., Keller, K. L., Brady, M., Goodman, M., Hansen, T. (2016).Marketing management. Pearson Education Ltd.. Shafritz, J. M., Ott, J. S., Jang, Y. S. (2015).Classics of organization theory. Cengage Learning.