PLEASE READ THE PAPER IVE INSERTED BELOW AND COME UP WITH A DETAILED CONCLUSION ON HOW WELL THE COMPANY PERFORMED. SHOULD WE KEEP INVESTING

 Note - this paper is in the POV of an external consultant from an Audit Firm, not Tech5's perspective. 

 

Tech 5, established in 2023, is a technological company based out of North America within the technology market niche. The company was founded by five members: Panagiota Babadelis, President; Jonathan Cuzco, Vice President of Business Analytics; Tham Nguyen, Vice President of Sales; Danielle Wardlaw, Vice President of Manufacturing; and Nechelle Wilson, Vice President of Finance. While Tech5 holds their headquarters in Chicago, US and a location in Los Angeles, the company is also globalized, holding a location in Paris, France and manufacturing in APAC.
 

Strategic Thinking 

Delivery of Market and Financial Results

 

Delivery of Market and Financial Results

Delivery of Market and Financial Results section 

 

Marketing Management

The company's marketing strategy from Quarter One demonstrates via consistency, to have chosen consumer segments Costcutter and Traveler. The company continuously invested in Market Research in order to educatively advance within their choices, effectively proving their strategy to be focused within these two segments. The target strategy in terms of distribution and location shows to remain with their headquarters area of North America in early Quarters with a location in Chicago and expand to Los Angeles. This strategy was made as a result of the market potential demand for both consumer segments. A globalization strategy was put in place in Quarter Two with expansion to Europe (Paris, France) which is also a direct result of market research demonstrating the market potential for the aforementioned consumer segments.

While the market strategy and targets are solid, there are a few lacking motivators regarding advertising. In reviewing the outcomes of Quarter Eight, it is reflected that there were complications throughout the lifespan of the business in regard to the advertising facet of Marketing. Per the research data, the ads made and distributed did not adhere to the standardization of Tech5's chosen consumer market segments; Costcutter and Traveler. While the data shows modifications within every quarter being made to improve the aforementioned advertisements for all product lines and market segmentations, Tech5 was unable to maximize the potential within this Marketing facet. Although the company has demonstrated continued growth within Marketing Effectiveness Quarter over Quarter, backed up by awarded Trophies within each Quarter, there is still a margin of growth opportunity, per the Balanced Scorecard referenced below (Marketplace Simulations, 2018b).

 

Tech5 developed several product lines per market segment, adhering to consumer needs and wants per the market research gained within each quarter. It appears that Tech5 had difficulty within the first two quarters in developing a product to market and made several changes within those product lines which resulted in the companies' ability to meet market demands with their first two product lines: desktop for Costcutter and laptop for Traveler. As time moved further along and knowledge was gained from market research, Tech5 shows to have implemented learnings into their market strategy in regard to product line as well as advertising based on competitor research as well as their bottom-line Market Strategy, in terms of establishing brand loyalty, resulting in a higher conversion rate.

In Quarter Six, Tech 5 embarked on the route of Research and Development, choosing to invest in a Pro-Upgrade on Office Software. This decision was one of the best decisions that the firm could make within their standing position. This investment would allow Tech5 to distribute the Pro-Upgrade software across all product lines for all consumer segments, in all market segments. Not only would this decision bring a higher market conversion, but also open the opportunity for licensing to other competitors. Unfortunately, while Tech5 had competitor interest in licensing, there were no partnership results.

There were operational errors within Tech5's methodology under manufacturing and sales which ultimately were revised during year two including hiring more sales staff and adjusting fixed capacity within production. These errors, although revised, cost the company possible market demands which turned consumers onto competitor products. It is apparent that there was not efficient cross-departmental collaboration between the Sales, Manufacturing, and Marketing departments which resulted in the need for extra training which was added in later quarters. 

Ultimately, Tech5 is a start up which has made errors but also has learned from these errors. The business dominates the Costcutter segment with a 32% Market Share, demonstrating the strategy established within Quarter One having proved positive results in meeting consumer and market demand (Marketplace Simulations, 2018b1). With a modification in strategy and new product lines, Tech5 may be able to continue in the market with a focus on Costcutter segments and expanding within North America market segments. The data shows that Tech5 was extremely reserved with its decisions early on and would benefit from an expansion risk. 

Investment/ Capital Investment/ Capital Spending on Sales Expansion and Marketing Productivity

Furthermore, Tech-5 initially invested in the 3-month certificate, as the company decided to hold cash on hand while expanding its operation. However, in such Typical economic progression occurs due to the increased production of goods and services. For example, increased consumer spending increases international trade, and businesses that increase their investment in capital spending can all impact the production level of goods and services in an economy.

Strategically, Tech-5's capital investment from the initial set up of its manufacture in Shanghai and distribution centers in Chicago and Paris could have done better. These are the types of capital spending that help Tech-5 set its foundation. Part of growing a business is the ability of a company to manage its assets, meaning that an investment in current capital could create future revenue. Tech-5's ability to take risk in expansion still has room for growth, such as the fixed capacity did not expand later in the 4^th quarter, which is already behind its competitor. Moreover, although Tech-5 decided earlier to set up its manufacturing facility in China, Tech-5 never invested in that region's research.

In the second quarter, Tech-5 invested in the second highest cost of NORAM location, Chicago, and the highest price of the most increased region, Paris. As a larger and more profitable market means the market has a higher potential and a higher operating expense. However, Tech-5 could have better calculated the potential market demand projection and the fixed capacity that its manufacturer could produce. Therefore, as resulting in stock out and creating a string of ill will. As such, the missed opportunity to meet market demand has also reduced significant revenue that Tech-5 could have earned. 

 

 

In these instances, Tech-5 also missed the opportunity to further invest in its future to generate potential revenue, primarily when the company conducts business in multiple countries but needs to pay more attention to foreign currencies. The initial results from the test environment have given Tech-5 false confidence in managing its market share as Tech-5 earned 34% of the total market share and is a leader in its target market, such as Costcutter and Traveler. Hence, its competitor begins to adjust their product and strategy; Tech-5 continues to hold the same distribution center into the next quarter and hardly expands its Salesforce. 

Lastly, setting up the production facility in the Shanghai APAC region is cost-saving as the Material Cost Index in Shanghai is the lowest compared to other regions. However, the part can be significantly costly, with a shipping cost from one area to another. Tech-5 has continued to make improvements and expansion in its operation. Therefore we can still see the company's growth trajectory, and its revenue has continued to increase steadily. Nonetheless, several key decision-making points have been missed, which would have enabled Tech-5 to have better growth potential, such as investing early on and purchasing market research in all regions of its operations. Increased fixed capacity early on, expansion plan in the correct location to pioneer instead of new entry into an existing market location, such as Los Angeles. Overall Tech-5 did ok but could have done better in investing in its sales and distribution center. While analyzing the company's tech five marketing and financial analysis the corporation had started as far as original profits and capabilities it seemed like Tech-five was going to grow in market share. 

However, as we analyze our last two previous quarters and the decision-making process we can see that these may not be the best investment terms. When we look at the balanced scorecard cumulative balance score card there were business activities that were negatively affecting performance. As we can see market performance is down for the entire performance is down market effectiveness investments wealth management asset management even manufacturing productivity is about the only thing that has not gone down. However one of the things that we do have to look at on total bases before my indicator is manufacturing did not leave enough fixed capacity to manipulate operating capacity to fit their needs.

  The long-term goal of Tech5 or any company within the marketplace would be to establish your executive team that was good at managing the firms' resources, product designs, entry into the market, manufacturing capabilities, and even accounting performance.

Key indicators our team had to consider through the third and fourth quarters is our

changeover improvement and investing more. Do tell us having four products in the market is 

a lot of products every time a different product is built within the manufacturing warehouse changing from one product to the other takes time, labor, and costs.

Market Demand	Column1	Column2	Column3	Column4	Column5	Column6
Company	Costcutter	Innovator	Mercedes	Workhorse	Traveler	Total Demand
Stone Solutions	921	713	203	589	483	2,909
ALEEA Inc.	1,339	719	149	4,326	5,701	12,234
Compak Technologies	1,214	2,069	726	1,114	2,225	7,348
IZON	3,048	1,048	841	3,015	2,032	9,984
TECH-5	3,085	313	72	2,073	1,268	6,811
Company 6	0	0	0	0	0	0
Total	9,607	4,862	1,991	11,117	11,709	39,286

Tech-5 originally did well by gaining market share in the Costcutter and Travelers segmentations doing well in their respective sectors (Marketplace Simulations, 2018a). However, issues with projected demands we can see in previous quarters were much lower than other teams. However, once analyzed it was realized that the company didn't meet a lot of branding needs and requirements to ensure consumers were happy. Projected maximum demand for the quarter had a capacity not only based on market share percentages and how each product performed on the market for specifications and features.  In addition to meeting customer specifications, the number of salespeople employed for the business limits the potential demand due to the limited number of sales that can be conducted. We can see in previous quarters where the company tried to revamp products such as test 2 and meet customer standards however by the time this was put to market it seems as though the demand had shifted. Revamping the previous products and putting out two new products in the same categories in hopes of even further reaching customer specifications by upgrading features on the TE2CC and TE2T.

 

Cumulative Results for Quarter 8	Column1	Column2	Column3	Column4
Indicator	Minimum	Maximum	Average	TECH-5
Cumulative Total Performance	0.000	78.801	23.778	3.178
Cumulative Financial Performance	0.000	100.581	44.553	22.713
Cumulative Market Performance	0.000	0.289	0.178	0.197
Cumulative Marketing Effectiveness	0.000	0.771	0.609	0.676
Cumulative Investment in Future	1.000	3.367	2.595	2.880
Cumulative Wealth	0.514	2.042	1.122	0.514
Cumulative Human Resource Management	0.025	0.874	0.715	0.870
Cumulative Asset Management	0.000	2.109	1.183	1.832
Cumulative Manufacturing Productivity	0.446	0.640	0.536	0.446
Cumulative Financial Risk	0.888	1.000	0.935	1.000

(Marketplace Simulations, 2018a)

Continual production of TE2T and TE2CC while the man production was dropping because of additional problems in tech fives balance store card and overall financial disposition. Due to issues with stockouts, we can see here due to the decrease in demand projections fixed capacity was not increased over periods of time. However when demand did go increase rapidly then the manufacturing process played a part in not being able to get the products to the consumers. Due to lower projected demand which ended up in lower projected fixed capacity, all operating capacity made it impossible for tech 5 to produce the number of products necessary in order to fit consumer needs.

This course stockouts overall dissatisfaction within consumers and reliance on the brand has gone down. One issue that I do see as an investor is the churn rate due to not having enough stock and constant stockouts which lead to disappointing customers. One of the strengths that tech five has is within the human resource department their industry's Salesforce composition is leaving the industry (Marketplace Simulations, 2018a). Currently, they are providing full coverage for two weeks' vacation, and a 10% pension which leads to a very high rate of productivity. The total yearly cost for Tech Fives complete compensation packages is around 60,000 leading them to have around a 91% productivity rate in the previous quarter.

          Therefore the cumulative financial performance was really affected negatively overall. As I do see potential in this company and their brands taking on too much at once seemed to hold them back from reaching their full potential. When we look at their changeover time and quality assurance, having so many products being made in one facility at once without considering having enough fixed capacity overall really affected the overall outcome of the team's finances. Difficulty meeting consumer needs and having the product available in the time that consumer needs specific features. In my recommendation, at this time I would not invest in Tech-5 until they are able to show a positive return on investments.