Leadership What is Leadership?Leadership is simply motivating a group of people for achieving towardsfor a common goal. Leadership let the group towards one direction by givingmore inspiration and guidance for the task which need to be fulfilled.
“Leaders establish the vision orthe future and set the strategy for getting there.” (Kotter, J 1990,What Leaders Really Do, HBR) Importanceof Leadership for Roti Café Leadership inspires themanagement in order to achieve overall business success by motivating theentire group with maximum satisfaction. Basically when compared to a manager agood leader possessed. · Vision led to long termhorizon· Facilitates in decisionmaking and build the creativity· Accept challenges· Appeals to the hearts· Taking proactiveactions· Motivating the staff(Educational Business Articles, 2018)The top management has the idea of expanding “The Colombo Roti Café” tomany areas in Colombo and beyond. In order to obtain this they should need along term vision to lead there business in to a major competitor in theindustry.
Proper decision making is highly importance for Mr. Fernando and Mr.Fonseka. With the right leadership and guidance they could easily facilitatetheir decisions. As well as creativity is a must for “The Colombo Roti Café” toattract more customers and to retain them for a longer period. When compared to todays’ business environment, it is rapidly changingwith new technology and new innovations. Therefore they should need a directleadership to understand and accept the challenges that comes across thebusiness environment.
Mr. Fernando and Mr. Fonseka are committing to ensure the quality, valueand the customer satisfaction. Leadership helps to understand what actuallycustomers expect from the business and how they can create a value of thebusiness in customers’ mindset. When they have a good leadership, they always seeking for the success ofthe business in each and every corner. They seek threats and weaknesses theyhave and take proactive actions for the challenges they come across in the dayto day business routines. Now The Colombo Roti Cafe accommodates up to 75 customers.
Therefore theyshould have a friendly staff to exhibit hospitality to the customer base theydealing. In order to get the maximum output from the staff, good workingenvironment and motivating top management is essential. PEST analysis and other related Environmentfactors. PEST analysis is helpful tool for analyzing the macro-environment(external) that impacts all the organization. PEST analysis focuses on the Political, Economic, Social, and Technological factors of the macro-environment. These externalfactors normally are exceeding the control of organizations and sometimesappear as a threat. Additionally,macro-environment factors such as law and the environment can have an impact onthe organization. With these two factors we can call it PESTLE analysistoo.
Political· Tax.· Health Regulations.The tax policy of thegovernment has a direct effect on this business. High taxes on flour, othernecessary food items and equipment can interfere with the business.In recent years investigation has beentaken by the public health inspectors against the food related business whichis not suitable for consumption and also equipment related to prepare the foodand have taken legal action against them. This management should use thestandardize equipment and raw material when preparing their food for avoidthese complications.
Economics· Consumer income and spending.· Exchange rate.If the economy is stable, people will have more money to consumemore. The rising cost of living is a reason to reduce the roti demand becauseroti is not an essential commodity.Increase in exchange rate will impact theprices of flour, spices and consumer equipment imported from abroad. Social· Consumer taste and fashion.
Social background of consumers is a veryimportant factor when it comes to food and beverage industry. When more peopleintend to use cafes for celebrate their personal and group events such as birthdays,get-together and the Anniversary celebrating, the demand for café will go up. Technology· E-Marketing.· Hotline.· New production process.Technology plays acritical role in present business world. The management can get a betteradvantage by using upgraded technology for their ventures.
It is important topromote products through the online media such as the internet, digital mediaand social media such as Facebook, Instagram. Communicatingto the customers about special offers via SMS and e-mail has become verypopular. Another way they can technology is to use a new roti making machinewith a high volume.Other relatedEnvironment factorsLaw· Employment Law.· Consumer Law.
Anychange in the labor law has direct impact on this business. If the governmentintroduces minimum wage, it may be reasons to raise the administrative cost ofthe business. Refuse to displaythe price list of items of the business place and avoid issuing a bill orreceipting when making a request, violates the consumer rights. Then theConsumer Affairs Authority act strictly against the business.(Caa.
gov.lk, 2018) Environment· Tourism.· Waste Management.As the cafe situatedin the city of Colombo, attraction of tourists will enhance the demand forcafé.
Further in order to in line with the environmental regulation, the caféhas to establish waste management system. Instead of polythene, it should focuson using environment friendly material. SWOT Analysis. What is SWOT?SWOT analysis is an acronym for Strengths, Weaknesses,Opportunities and Threats.
· Strengths (internal,positive) -Characteristics of the business or project that give it an advantage overothers.· Weaknesses (internal,negative) -Characteristics of the business that place the business or project at adisadvantage relative to others.· Opportunities (external,positive) -Elements in the environment that the business or project could exploit to itsadvantage.· Threats (external, negative)- Elementsin the environment that could cause trouble for the business. Identification of SWOT:-Identification of SWOT is important to café being theycan use the findings in developing strategies to achieve objective. Accordinglyit has to consider whether the objective is attainable in the context of thefindings of SWOT.
S -Strengths forColombo Roti Cafe.This element addresses the things that Colombo RotiCafe does especially well. It includes intangible, such as Company’s brandattributes, or something more easily defined such as the unique selling prosposition of a particular product line. It could also be the human resource andstrong leadership.
· Excellent, well-trafficked location.· Good reputation among local community.· Seasonal locally sourced menu. · Secret recipes. · Wide product range including five types of roti.· Attractive and clean place & facilities.· Quality of the products.· Internal resources such as skilled, knowledgeable staff.
W-Weaknesses forColombo Roti caféWeaknesses means the things the company perform poorlyand things that company keep away from its success. Every organization has itsweaknesses which is equally applicable to Colombo Roti Café as well. Theweaknesses relating to the Colombo Roti Café are as follows. · Not currently using food delivery apps/technology· Single location means limited reach· Higher costs than comparable chain restaurants· Modest advertising budget O-Opportunitiesfor Colombo Roti cafeThis means elements in theenvironment that the business could exploit to its advantage.
Opportunities are acombination of different circumstances at a given time that offer aPositive outcome, if taken advantage of. Theopportunities of Café are as follows. · Emerging need for the food products.· Press/media coverage of the shop.
· Changes in government policy related to the field.· Changes in social patterns, population profiles, lifestylechanges, and so on.· Local events.· Growing interest in/support for locally sourced ingredients· Seasonal menu keeps things fresh and interesting· Potential for growth via food delivery apps/technology T-Threats forColombo Roti cafeElements in the environment that could cause troublefor the business are considered to be threats and those are related to Café areas follows.Intensifying competition from established chainrestaurants· Uncertain economic environment · Rising costs of ingredients· Changing technology· Have bad debt and cash–flow problems Porter’s Five Forces Rivalry amongst existing competition (Inter firmrivalry)In this context “TheColombo Roti Café” it can be identified higher competition because the currentmarket is already dominated by the main competitors like McDonalds, KFC, BurgerKing. This can create major impact on the profitability of the business. In orderto face these situations “The ColomboRoti Café” management needs to consider on developing strong brand whichcan compete with the established competition. To improve the brand name, it isrequired to focus on providing good quality and healthy variety of foodproducts which in turn helps to increased customer satisfaction.
Threat of New EntranceThis is the start of new competition. Companies mostlyface these types of situations when the business shows higher potential ofearnings. In this scenario “The Colombo Roti Café” has faced with moderatethreat in relation to that due to the following factors· Varity of food served.· Availability of outlets.· method of delivery (Costs on supply chain)· Consumer tastes and habits.· Prices of the products compared to the other food outlets.· Quality of the foods and the customer service provided.
They needs focus more on provide new verity of foodproducts that serves than other food outlets, based on the consumer tastes andhabits which gives different experience other than food outlets like McDonald’s,KFC and other restaurants at affordable prices, rather stuck on producing samequality “roti. Also they need to expend more in development of their businessoutlets where more people living and busy cities. It would be more ideal to forceson expanding their outlets at the same locations of McDonald’s and KFC’ssituated, so that they can switch the customers towards their outlets.Threat of substitutes or SubstitutionSubstitutes are the products that can be used toreplace the use of the existing product.
This is a threat to the businessbecause of the fact it can challenge the profitability of the business and itmainly effect the growth of the business. In this “The Colombo Roti Café” casefollowing factors effect highly to the growth of the business.· Number of substitute availability at the same industry.
· Product quality improvement and the consumer satisfaction.In this “The Colombo Roti Café” scenario the productssame as “roties” available at the super markets as substitutes which werepre-cooked so consumption of those is very high, to challenge this they needsto focus on serve more quality and healthy food products which increasing customersatisfaction and demotivate the use of substitutes. Bargaining power of the customersCustomers will always demand for high quality productsat lower prices. Prices would be determined by both parties after series ofnegotiations. If the buyers have a higher bargaining power, the supplyingcompany might have to experience low profits. In this “The Colombo Roti Café”case the following factors create strong impact on the Bargaining power of thecustomers.· Number of food outlets.· Availability of substitutes.
· Prices of the products. Inthis “The Colombo Roti Café” context availability of other providers in thesame industry is high so that there is a high tendency on people move towardsother providers like McDonald’s and KFC and other restaurants. Other factor isthat availability of substitutes also is high in the industry which gives thesame outcome.so that the management needs to focus on to provide high qualityhealthy foods at affordable prices which in turn helps to increase the customersatisfaction other than the McDonald’s, KFC or other restaurants. Bargaining power of the suppliersSuppliers too can affect the profitability of thebusiness by charging higher prices or providing lower quality products.
In thiscontext “The Colombo Roti Café” casethe top management’s main concern is to expansion of the business island widethis means that they also needs to focus on increasing the suppler network inorder to find more quality raw materials at a affordable rate which impact thedetermination of pricing. Most important fact is they have to maintain inter connected supplier force so that it will beeasier to fulfill their raw material needs when it required. Conclusion The Colombo Roti Café is established inthe heart of Colombo and has been able to ensure the success within a shorterperiod of time. Yet, it can be noted that the café has faced with severaldelinquents including lack of trained and skilled staff, severe competition andlack of capital infusion. Accordingly it has not been able to fulfill its predetermined objective of expanding the business in other key hubs in Colombo.Yet after analyzing the internal andexternal environment of the business it was noted that though the café hasfaced with several challenges, it could be easily faced with them along withthe strengths possessed by the café and with better management. Thus, as management consultants, we findthat the proposed business expansion is viable with the financial assistancefrom a bank, new technology & innovation. The business should recruit anexperienced & specialized staff to address immediate issues and to proceedwith the business expansion operation.
With that the café will be able toensure its growth and success in the long run.