GAGA and it will also result in the launch taking 25 weeks, which will be one week longer than the target set. The consequences of this delay will affect many different people such as the consumers, the competitors and the opportunity costs. This delay will mean that the launch that was intended for London fashion week will not be achieved and the consumers that placed contracts for advertising throughout the first year of publication which will not only lead to less opportunities in the future due to damaged reputation but also they won’t achieve the money that they were set to from their interact because it wasn’t met.This in turn will result in less funding for reinvestment in a relatively new business venture and also less likelihood of the fashion houses using this company in the future and a higher chance of the fashion houses utilizing their competitors.
According to their Marketing Director, she believes that the companies’ rivals are also launching their own digital magazines at a similar time and they have started their marketing campaigns already which will mean that the company will also miss out on the first mover advantage which means they will lose a significant amount of venue and business to competitors. . E-employer/employee relations refer to the relationship between the managers of a business and the workforce and/or their representatives. The change to a more flexible workforce consisting of a smaller number of ‘core’ workers combined with ‘peripheral’ workers employed on a part-time or temporary basis will result in many employees being made redundant. Furthermore, traditionally, the business has consulted with the trade union on issues such as this through a well- established Works Council.However, Harry considers that the previous management offered too many concessions and he intends to inform the trade union of his decisions rather than consult with it.
This is a big problem considering the trade union has been prepared to take industrial action when it felt it was necessary and also that he could ruin relations which were before seen to be healthy. Especially seeing as 75% of the workforce belong to a trade union, this mixed with the union’s willingness to act means that it is very likely that the company will shut down for at least a couple of days and the opportunity cost for this could be significant.The industry average of number Of days lost per year due to industrial action is lower than that of Roberts Media Pl which only adds to the fact that industrial action is likely. Furthermore, the fact that the average age of employees is 50 years old which is ten years older than the industry average at 40 years of age. Also, the fact that the average length of service at this company is 25 years compared to the industry average of 10 years, with this long service and older age, if there were redundancies and industrial action then the cost of severance pay is likely to be severe and very high.This loss of money will cause the company o lose valuable money which they need to help start up their new digital business venture.
Generally, employer/employee relations have been effective through consultation with the works council but now Harry Gardner has decided that he will simply inform of them of the actions he will be taking which will ruin relations. Furthermore, the move to Manchester and working from home could lead to better relations with the employees due to the fact that they will be working in a healthier environment and they will save money on travel expenses.If the company offers fringe benefits and potentially a omission to salesmen then this could provide employees with incentives to carry on and work through the strikes. These changes could ruin employer/ employee relations and industrial action is likely which will be extremely disruptive to the company in the short run. Harry Gardner must be prepared to meet with the trade union and make concessions quickly in order to stop the likelihood of any potential action they could take against him.It is likely that relations with even the core workers will be damaged and he must address them potentially with different types of incentives as was stated earlier. To conclude, it is possible to maintain effective employer/employee relations as long as Harry Gardner is willing to make concessions and meet with the trade union to meet a collective bargaining agreement.
The new venture which the business is about to embark upon is healthy and important for the company in the future and this needs to be accepted by all sides. 4. Roberts Media Pl is a publisher of well-established market fashion magazines.It has strong links with fashion brands such as Pravda and Airman. However, the readership has fallen in the past novo years due to a number of seasons including the recession and competition but mainly the switch of consumers from physical to digital media. Robert Media ply’s profits fell by 12% in 2011 and as a result the share price fell which led to the appointment of a new CEO in Harry Gardner.
He wishes to switch to digital media as he believes that is where the future of the newspaper and magazine industry lie, there are arguments for and against this proposal.In the first world and particularly amongst affluent 45-54 year-old women, there is much increased broadband access and this has combined with the rising popularity and increase in owners of smartness and tablet computers such as the pad. Furthermore, the monthly visitors to UK news and information websites have been forecast to rise to 50 million by 2013 as well as the fact that the market value Of the KICK women’s print magazine market is predicted to fall from IEEE million in 2013 to IEEE million by 2015.Harry proposed that they convert all of Roberts Media ply’s magazines from print to digital format, that they change to a more flexible workforce and relocate the head office and lastly, that they close the fireworks and distribution network.
The new digital Gaines would have the following features: the content would focus on health and beauty, fashion and celebrity gossip, selective content would be free whereas full access would be available only on a subscription basis and lastly, the subscriber would enjoy additional features such as video clips, bedposts and discussion forums.The latter of the three features has a unique selling point which adds value to the option of subscribing to the magazine as they cannot gain this anywhere else. When they subscribe they have to provide details such as income, occupation and lifestyle which would be toured on the company’s customer database. This would act as not only free primary market research but also the advertisers would be interested in these facts so that they would evaluate the risk in advertising in this particular’ magazine.
Furthermore, the forecast number of digital subscribers to women’s magazines is rapidly increasing.The figures are forecasted at 3 million in 2013, rising 5 million in 2014 and even reaching 10 million by 2015. This provides a growing target market which gifts the company chances of increasing the subscriber count. The company also conducted additional remarry market research in which they sampled 300 women and asked them how much they would be prepared to pay for a monthly subscription to a digital magazine and they found out that just over 60% of women would be prepared to pay EH, combine this with the heavily increasing potential subscriber base and you will easily improve the company’s return on capital once more.
Moreover, additional reason to go with Harry Gardener’s proposal is his change to a more flexible workforce with a smaller number of ‘core’ workers combined with ‘peripheral’ workers employed on a part-time basis. This will lead to the core workers feeling more valued as well within this entrepreneurial organizational structure. The relocation of the head office to a smaller, cheaper location in Manchester will significantly reduce costs and by encouraging more employees to work from home, you effectively eliminate absenteeism or at least get rid of a lot of it.Harry believes that if his proposal goes ahead, their digital magazines must be launched in less than 6 months’ time to coincide with London fashion week in which a significant number of fashion houses have placed contracts for advertising throughout he first year of publication guaranteeing business as soon as they switch. Finally, if their launch is successful than they will gain ‘first mover advantage’ in a growing market. This will increase their chances of achieving a high market share as soon as they enter the market.Harry Gardner has increased the company s chance of success by ensuring that when they subscribe, customers provide details which advertisers will be favorable too and in providing the company with more revenue. This increased revenue coupleВ« with the fact that they are saving money by relocating to a cheaper location ND cutting off the costs from the unnecessary proportion and distribution network will lead to a very likely and realistic chance that by 2014, they WI have reached the objective of 8% return on capital employed.
On the the hand, there are also arguments against the move from print to digital. At moment, there target market is simply affluent 45-54 year old women, however, middle aged women don’t tend to be the most technologically and they may lose a lot of customers due to the fact that their current customers aren’t willing to switch to the digital version which could backfill ND affect them substantially financially. The Return on capital employed fallen by 8% from 10% to 2% in just a years’ time and they are only forecast! A 4. % return on capital employed in 201 3 but if they switch to digital for and they don’t get as many customers as they believe they will than there no evidence to substantiate this rise in return in capital. Furthermore, whereas roughly 60% would be prepared to pay EH a month, an addition 40% would not be prepared to pay that fee and this means more potential customers lost. Also, it says that 60% would be prepared to pay for the obstruction but that doesn’t mean that 60% will actually pay for the subscription. A lot Of the people that said they would either wouldn’t both or even may change their mind.
Harry Gardner wants to set a target of 2 million subscribers by 201 5 which is a target which Lisa who is the Market Director believes is not only overly ambitious but also highly unlikely. She believes that a significant marketing budget would be the most important component of the marketing plan as it is imperative that there is more detailed market research as there is gaps in the current research, the training of sales staff for digital over print format and lastly an extensive promotional campaign to announce the launch.She has also informed HE that many of their rivals are launching their own digital magazines in the r six months and have already started their marketing campaigns; however Harry is reluctant to listen to his Marketing Director and thoroughly Addis over the importance of the marketing budget. Furthermore, the switch to more flexible workforce coupled with the closure of the proportion and distribution network will leave many employees redundant which could sibyl cause industrial action because usually the company consults the trade union first but Harry intends to simply inform them.