Business Integration: XYZ Construction Inc. Strategic Plan

Subject: Management
Pages: 8
Words: 2227
Reading time:
9 min
Study level: PhD


The owners of XYZ Construction Inc. (Horizontal and Vertical Construction Company) are nearly ready to proceed with their Initial Public Offering (IPO). In order to carry out a successful IPO, the company must have a strategic plan that would act as a guide for the company. A strategic plan facilitates a business to reap benefits by recognizing and seizing new opportunities ahead of emerging competition from similar businesses (Wysocki, 1997).

This paper presents a strategic plan with a description, discussion and an in depth analysis of all the essential elements. In addition, the strategic plan follows specific goals and strategies that the XYZ Construction Inc. must follow. More specifically, the strategic plan will determine how the company allocates its resources and makes decisions in future. In this paper the SWOT analysis, (Strengths, Weaknesses, Opportunities and Threats) process will be integrated in the XYZ Construction Inc. strategic plan.


In establishing an internal baseline, XYZ Construction Inc. business objective is to carry out a successful IPO so that the company raises as much capital as possible. An IPO is also known as a stock market launch and implies the first sale of company’s stock to the public. The monies realized will go directly to the construction company and will be used for future growth or as working capital (Rafft, 2007). It is important to note that XYZ Construction Inc. has proven excellent in sale of construction equipment such as trucks as well as material like cement.

The company is centrally located in ABC town where construction boom has been evidenced over the last few years. This being the case, it is to their advantage that XYZ leads in the market because the next competitor is in neither sight nor in the near future. The biggest revenue volumes as already mentioned come from sale of cement and this forms the core business hence the need to increase profits while at the same time ensuring expenses and hiring are under control.

In relation to external baseline, XYZ Construction Inc. has had several factors affecting its growth in other major towns located far away. This is mainly due to the presence of raw material for cement manufacturing hence the centralized nature of the company. The IPO on the other hand would be beneficial if exporting of cement to such towns becomes real. In terms of whether the XYZ cement will maintain its competitive edge, there is no doubt since the brand is popular enough (Allison, & Kaye, 2005).

SWOT Analysis

The SWOT analysis in respect to XYZ Construction Inc. recognizes the following; that despite the lack of immediate competitor in the market, there is need to come up with a strategic plan based on the company’s strengths, weaknesses, opportunities and threats (Dealtry, 1992).

The company’s strengths lie in the uniqueness of the products is has on offer. The construction materials are mainly modern and durable unlike the traditional solutions that many customers have always used. In addition, the products are well designed to fit customer requirements by offering affordable quantities and at reasonable prices. This fact has made it possible to come up with a brand that has seen large number of potential customers in terms of sales as well as being user friendly.

The weaknesses can be associated by failure to have a global or international appeal although the company is working towards this end. Some of the products of XYZ are also highly specialized making them unsuitable for small-scale customers. These weaknesses however are addressed in the strategic plan and will be sorted in the near future.

There are numerous opportunities arising from the XYZ business and these include the booming economy as well as the government encouragement for people to buy local products. Since the company relies on direct sales to its customers, the strategic plan wishes to integrate third party retailers who will reach out to the remotest parts and introduce XYZ products. There is also great potential emanating from numerous advertising campaigns for the company’s products that is currently being enrolled. Advertisement will of course create new avenues for product retail and the plan is to have the print media and television carry out these messages. Another opportunity will come about with the advent of Information Technology platform that would propel the company towards global markets.

The threats have been few in respect to XYZ Construction Inc. since there is no visible or serious competitor. However, the sourcing of raw materials has been somehow tumultuous and the company hopes to streamline this aspect. The government concern has been noted in terms of placing strict guidelines in quarries where XYZ has an interest. The main concern is the environmental impact brought about by excavation of stones and limestone, which forms core raw material for XYZ Construction Inc. In this regard, the company top management will work hand in hand with the government and related organizations to ensure compliance with laws and regulations and for the company to secure future sources of raw material. SWOT is hereby discussed in the following areas; (Dealtry, 1992).


Marketing refers to the process of creating value for customers and for the business in return and in an environment where a relationship is established to provide solutions for this to occur. In order for XYZ Construction Inc. to be a market leader, there is need to have marketing plan. A market plan must be well formulated for the success of the business and should feature proper managerial techniques for the smooth running of the business operations. It will also enhance partners and employees to be dedicated and have confidence in the business (Westwood, & Institute Of Directors. IOD. 2002).

Workforce and Operational Management

Management in any organization is important since it lays down the procedures to achieve a specific goal. It is the work of the management to ensure day-to-day operations of an organization and this involves managing the staff and their duties. The staff must be motivated to carry out their assigned duties for the overall success of the company. This may be in form of putting in place motivational aspects such as generous remuneration and allowances so that the employees become motivated to work harder.

The working conditions should also be ideal to all employees such that they feel safe and secure while working. In XYZ Construction Inc., workers are motivated by earning commission and overtime pay for their extra hard work. This however is not enough due to the nature of the work done here. The strategic plan hopes to incorporate a human resource manager in future who will look in to the welfare of the employees to make the company the best and ideal working environment (Vance, & Paik, 2011).

Organizational Structure

An organization structure is very important in every organization since it defines the chain of command. XYZ Construction Inc is structured in both horizontal and vertical organization structures thus making decision making in the company very efficient. The top management is comprised of a CEO and a vice-president. The company has several departments such as; quality control, business development, transport, sales and marketing and research, all, which a qualified department manager heads. These managers in turn are assigned supervisors who oversee day-to-day operations of the company as well as communicating the company mission and vision to junior staff.

International Operations

It is unfortunate that XYZ Construction Inc. does not have any international operation currently. However, there are plans to start exporting the company’s products abroad in the next two years and hence the strategic plan will integrate this vision in its plan. The company has been able to forecast that construction business is on the rise in many neighboring countries and hence it would be wise to capture some market in future. Given the fact that with increased investor interest in XYZ has been noted, an IPO such as the one in the offing will be arranged in future so that the company may diversify its operations abroad.

The key areas it hopes to capitalize on are provision of construction equipment since these plays a vital role in any economy. In addition, the company will put in place a consulting department that will be mandated in providing information to potential customers in the construction industry. The research and development department is also carrying out numerous studies in what is required by such countries to come up with comprehensive report on the same.

Financial and Accounting Management

XYZ Construction Inc. endeavors to utilize the International Financial Reporting System in its finance and accounting management in order to remain relevant in modern business. In its strategic plan, the Accounting department has invested a lot in ensuring their staffs are conversant with current accounting procedures as well as good accounting practices. The strategic plan has for instance singled out the need for hiring a qualified overall accountant who will ensure that the above-mentioned goals are met.

In addition, all junior staff in the department will undergo refresher courses to initiate them with the required skills. Apart from this, the top management realizes that the most basic component of business lies in its accounting process and has thus communicated their desire to have each departmental manager to be adequately versed in accounting procedures regardless of their other professions (Rumelt, et al, 1991).

Compliance and Legal Considerations

XYZ Construction Inc. by virtue of being in construction business is mandated by law to ensure compliance with regulations governing such an industry. In this respect, the company has in past-sought legal advice from qualified persons on matters pertaining governments regulations requirements. In general, the company ensures it follows such regulations like employment law, health and safety regulations, and corporate social responsibility as dictated by the state. In addition, the hired company lawyer who ensures representation in matters pertaining to the company handles the company’s legal aspects. In the strategic plan, it is envisioned that the company may as well recruit its own permanent lawyer instead of hiring like in the past. This move will prove advantageous in that a permanent lawyer would concentrate in the company’s interest hence offering the best service.

Internal Control and Evaluation

Internal control and evaluation is maintained in the company at all times. This takes the form of ensuring that business practices are followed at all times and are constantly evaluated to be current. The CEO for instance holds meetings once every month whereby each manager is required to report on the progress he or she is making in the company. The board will then scrutinize these reports to ensure they fall within the laid out mission and vision of the company and if not countermeasures are taken. In addition, audits are carried out in every department to ensure they comply and to detect things that might go wrong. The company willing future seek services of external auditors so that the best practices are maintained.

Information Technology

Information technology is vital in each modern business especially in the wake of globalization. Information technology comprises of putting in place the infrastructure and using it to increase productivity, make decision and project future undertakings. XYZ Construction Inc. intends to install a full pledged Information Technology department tasked with the above objectives. This is because the company currently underutilizes this important aspect by only performing simple tasks using computer technology.

The IT platform will enable sharing of information among the decision makers in a fast manner unlike the traditional face-to-face meetings. With computer technology in place, the company’s records become easily accessible to each member of the staff hence ensuring that they are always updated with correct information. The IT platform in this case of an impending IPO can be of tremendous help in terms of planning, archiving and projecting future endeavors. Since as already pointed out that the company lacks adequate Information Technology platform, the strategic plan will integrate the urgency to install one. The plan is to acquire the infrastructure; computers, network, software, as well as the skilled work force to handle them (Khosrowpour, M. 2001).


It is important to acknowledge the vital role of leadership in every successful business. In this respect, XYZ Construction Inc. has made it a habit to have excellent leaders in place. The CEO for instance leads by example by nurturing important leadership skills and virtues necessary for a successful business. These include; honesty, accountability, trust and decisiveness among other essential leadership skills. The same standards are required across the entire company without exception. Perhaps it is worthy to mention that excellent leadership and management are essential elements of a successful business and both should be stressed across all organizations. It has been the norm of XYZ top management to make decisions although under this strategic plan it is important to include all staff in future management and leadership decision-makings (Adair, 2010).

In conclusion, the strategic plan for XYZ will follow these important guidelines so that it becomes successful in future. Some of the mentioned will require additional capital to implement hence the Initial Public Offer will prove useful in that capital realized can be directed towards achieving some of these developments. The strategic plan if presented to potential investors and specifically if it promises to deliver such development such as already discussed will propel XYZ Construction Inc. to greater new heights (Wright, 1987).


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