2. 2
Dedication
“ We dedicate our efforts to our parents, who pray for us every minute, our teacher, who guide us
at every step of our life and our classmates, who stand by us whenever we need them and to all
those who help and encourage us whenever we find hurdles in our life.”
3. 3
Acknowledgement
It is one of the infinite blessings of almighty ALLAH that, He bestowed us with the potential and
ability to complete the present task and make a material contribution towards the deep oceans of
knowledge. We avail this opportunity to bow our head before ALLAH almighty in humility.
Who has given us the wisdom and perseverance for completing this report.
We invoke peace for Holy Prophet Muhammad (P.B.U.H) who is forever torch for humanity. We
feel highly privilege for our course instructor Prof. Amjad Hussain. Who taught us Business
Policy & Strategy and further gave us a guideline to this report.
4. 4
Original Vision and Mission Statement
VISION STATEMENT:
“To transform the company into modern and dynamic cement manufacturing company with
qualified professionals and fully equipped to play a meaningful role on sustainable basis in the
economy of Pakistan”.
MISSION STATEMENT:
“To provide quality products to customers and explore new markets to promote/expand sales of
the Company through good governance and foster a sound and dynamic team, so as to achieve
optimum prices of products of the Company for sustainable and equitable growth and prosperity
of the Company”.
5. 5
Proposed Vision and Mission Statement
VISION STATEMENT:
Our vision is to be the rolling partner in nation’s development, by making standards that meet the
expectations
MISSION STATEMENT:
“DGKCC’s mission is to be the most successful cement manufacturing company in Pakistan, by
satisfying the customer with best experience & by doing so, we will meet customers highest expectations
of quality, we provide opportunities of growth & enrichment to our employees, latest technology , best
quality product, individually & company accountability & to be very known among the citizenship”
Customer
Satisfying the customer with best experience.
Product or service
DGKCC’s mission is to be the most succesful cement manufacturing company.
Markets
In pakistan.
Technologies
Latest Techonology.
Concern for survival growth
We will meet customers highest expectations of quality.
Philosophy
Individually & company accountabilty.
Self-concept
Best qualitity producet.
Concern public image
To be very known among the citizenship.
Employees
We provide oppurtunities of growth & enrichment to our employees.
6. 6
External Factors Evaluation (EFE) of DGKCC
Opportunities Weight Rating Weighted
Score
Demand of Cement increase 10% due to new developing projects in the
country
0.08 4 0.32
Increase in the demand of Cement Export increase by 5.72%. 0.08 3 0.24
The MOU b/w Pakistan & Iran on Eco. Corporation signed. 0.05 3 0.15
Due to the stable growth of economy it leads DGK towards stable growth. 0.04 4 0.16
Shutting down the one of the Lucky cement plant becomes the opportunity
for DGK to take his place.
0.05 3 0.15
Opening a new plant in Karachi is the opportunity for the DKG to increase in
the production and its sale.
0.06 4 0.24
Coal Prices and consumption is decreased in international market. 0.05 3 0.15
Increase in utilization of cement due to CPEC projects. 0.09 4 0.36
Establishing manufacturing facilities in attractive foreign markets, especially
in African continent.
0.06 3 0.18
Market in Southern Pakistan. 0.05 3 0.15
Threats
Cement industry adopt to adopt latest technology in Tiruchi 0.06 4 0.24
Due to US bomb attack in Afghanistan the DGK cement export effect 0.04 3 0.12
Taxes increased due to taken fresh loans of $25 billion in last three years 0.05 3 0.15
Inconsistent government policies. 0.06 3 0.18
Increased GST by Rs. 100 on 50kg cement bag. 0.03 2 0.06
Lucky cement as strong potentialcompetitors. 0.04 2 0.08
Unhealthy industry competition. 0.03 1 0.03
Chinese investment in Dewan group. 0.05 2 0.10
South Africa imposes duties on Cement. 0.03 2 0.06
TOTAL 1 3.12
7. 7
Internal Factors Evaluation (IFE) of DGKCC
Strengths
Weight Rating Weighted
Score
Excellent credibility & creditworthiness. 0.06 3 0.18
Solid brand equity 0.8 4 0.32
Extensive dealer network. 0.06 3 0.18
Easy access to financial markets. 0.04 3 0.12
Product Quality 0.08 4 0.32
Enterprise resource planning 0.04 4 0.16
High production Capacity 0.08 3 0.24
Plant’s geostrategic importance 0.06 4 0.24
Parent company’s diversified business segments 0.4 3 0.12
Own Power Generation 0.06 4 0.24
Weakness
No physical presence near seaport & southern areas of Pakistan. 0.05 2 0.1
Limited skill set of human capital 0.06 1 0.06
Low promotion strategy 0.04 2 0.08
Reliability on weather 0.02 2 0.04
Transportation Cost 0.02 2 0.04
Health concern for employees 0.04 2 0.08
Autocratic Decision making 0.03 1 0.03
Job dissatisfaction 0.06 1 0.06
No performance appraisal 0.04 2 0.08
Fluctuating energy cost 0.04 2 0.08
Total 1 2.77
9. 9
Competitive Profile Matrix:
Competitive profile Matrix is an essential strategic management
tool to compare the firm with the major players of the industry.
Competitive profile matrix shows the clear picture to the firm about their
strong points and weak points relative to their competitors. The CPM
score is measured on basis of critical success factors, each factor is
measured in same scale mean the weight remain same for every firm
only rating varies. The best thing about CPM that it includes your firm
and also facilitates to add other competitors make easier the competitor
analysis.
In, IFE matrix only internal factors are evaluated and in EFE matrix only
external factors are evaluated but CPM include both internal and
external factors to evaluate overall position of the firm with respective to
their major competitors.
The competitive profit matrix consists of below mentioned attributes.
Rating
Weight
Weighted Score
Total Weighted Score
Rating:
10. 10
Rating represents the response of the firm towards the critical success
factors. Highest the rating the better response of the firm towards the
critical success factors, rating range from 1 to 4.
Rating is applied to each factor.
Major strength = 4
Minor strength = 3
Minor weakness = 2
Major weakness = 1
Weight:
Weight attribute in CPM indicates the relative importance of
factor to being successful in the firm’s industry. The weight range
from 0.0 means not important and 1.0 means important, sum of all
assigned weight to factors must be equal to 1.0, otherwise the
calculation won’t be considered correct.
Weighted Score:
Weighted score value is the result achieved after multiplying each
factor rating with the weight.
Total Weighted Score:
The sum of all weighted score is equal to the total weighted score,
final value of total weighted score should be between range 1.0 (low)
and 4.0 (high). The average weighted score for CPM matrix is 2.5,
any company total weighted score fall below 2.5 is considered as
weak. The company total weighted score if higher than 2.5 is
considered strong in position.
12. 12
RELATIVE MARKET SHARE POSITION
INDUSTRYSALESGROWTHRATE
High Medium Low
Medium
Low
High
DogsCash Cow
Stars QuestionMark
0.001.0 0.05
+20
-20
BostonConsulting Group (BCG) Matrix
13.93%
0.89 0.78 0.62
1.61%
OP 39.6%
5
%
Clinker 26.2%
SR 34.2%
5
%
11.30%
13. 13
BCG MATRIX
The BCG model is based on the product life cycle theory that can be
used to determine what priorities should be given in the product
portfolio of a business unit. To ensure long term value creation, a
company should have a portfolio of products that contains both high-
growth products in need of cash inputs and low-growth products that
generate a lot of cash.
Placing products in the BCG matrix result in 4 categories in a
portfolio of a company:
1. Stars: (High growth, High market share)
Use large amount of cash and are leaders in the business, so
they should also generate large amounts of cash.
Roughly in balance on net cash flow. However if needed any
attempt should be made to hold share, because the reward will
be a cash cow if market share is kept.
2. Cash Cows: (Low growth, high market share)
Profits and cash generation should be high because of the low
growth, investments needed should be low.
3. Dogs: (Low growth, low market share)
Avoid and minimize the number of dogs in a company.
Beware of expensive, turn around plans.
Deliver cash, otherwise liquidate.
4. Question Mark: (High Growth, Low market share)
High demands and low returns due to low market share.
Great amount of cash is invested in question mark
If change is not implemented, then the growth stops a dog.
Invest heavily or sell off or invest nothing and generate
cash
The Strategic Position and Action Evaluation (SPACE) Matrix
14. 14
SPACE Matrix for a DGKCC
Financial Position (FP) Rating
Net profit 5
Earnings per share 3
Debt Equity Ratio 4
Stock Turnover Ratio 4
Inventory turnover 5
Average 21/5= 4.2
Competitive Position (CP) Ratings
Brand Image -1
Distribution Network -1
Technology -2
Customer Loyalty -1
Market share -2
Average -7/5= -1.4
Stability Position (SP) Ratings
GDP -2
Rate of Inflation -3
Tax -1
Barriers to entry in market (Govt. Policies) -2
Peace & Security -3
Average -11/5= -2.2
Industrial Position (IP) Ratings
Resource Utilization 5
Financial Stability 6
Resource Utilization 4
Growth Rate 5
Competitors 4
Average 24/5= 4.8
15. 15
Y axis X axis
FP +4.2 +4.8 IP
SP -2.2 -1.4 CP
Total +2 +3.4
16. 16
Space Matrix:
It is used to determine what type of a strategy a company should
undertake. Space matrix is a strategic management tool, which focuses
on strategy formulation especially related to the competitive position of
an organization. There are two internal and two external strategic
dimensions. FP & CP compare your company with other companies.
Therefore, EP & IP compare your industry with other industries.
In a space matrix, there are four quadrants & each quadrant represents a
different type of nature;
Aggressive
Conservative
Defensive
Competitive
In space matrix, CP and IP values are plotted on x-axis
CA value range from -1 to -6.
IP value range from +1 to +6.
Whereas, FP and SP/EP are plotted on Y-axis
SP/EP value range from -1 to -6
FP value range from +1 to +
-1 -2 -3 -4 -5 -6
+6+5 +4+3 +2+1
Strong Average Week
17. 17
The above scale shows that, EP/SP and CP rating scale from -6 (worst)
to -1(Best). IP & FP rating scale is from +1 (worst) to +6 (Best). After
rating each factor of EP, CP, IP and FP average is taken of the rating and
then total of all average is taken. By taking total of Y-axis and x-axis the
net result will be marked on the space matrix and it will show the
competitive position of an organization.
The above space matrix show the firm position as an Aggressive.
Financially strong firm that has achieved major competitive advantages
in a growing and stable industry. An organization is in an excellent
position to use its internal strength to take advantage of external
opportunities, overcome internal weakness and avoid external threats.
Therefore, Market deviation, Market penetration, product development
and integration can be feasible depending on the specific circumstances
that the firm faces.
AGGRESSIVE:
Market Deviation
Market Penetration
Product Development
Integration
18. 18
SWOT Matrix
SWOT Matrix:
Strengths :
1. Solid brand equity
2. Extensive dealer network.
3. Easy access to financial markets.
4. Product Quality
5. High production Capacity
6. Own Power Generation
7. Plant’s geostrategic importance
8. Parent company’s diversified
business segments
9. Excellent credibility &
creditworthiness.
Weakness:
1. No physical presence near
seaport & southern areas.
2. Limited skill set of human
capital
3. Low promotion strategy
4. Reliability on weather
5. Transportation Cost
6. Health concern for employees
7. Autocratic Decision making
8. Job dissatisfaction
9. No performance appraisal
10. Fluctuating energy cost
Opportunity:
1. Demand of Cement increase
10% due to new developing
projects in the country
2. Increase in the demand of
Cement Export increase by
5.72%.
3. Establishing manufacturing
facilities in attractive foreign
markets, especially in African
continent.
4. Market in Southern Pakistan.
5. Due to the stable growth of
economy it leads DGK towards
stable growth.
6. Literacy rate in Pakistan rise to
59.9 percent.
SO
Increase nationally sale 7%
(s2,s5,o1)
New plant in African
continent
(s1,,s3,03)
Market penetration
(s2,o4)
Increase foreign sales 6%
(s4,s5,o2)
WO
Market
Development(w5,o4)
Training of
employee(w8,o5)
Hiring new blood
(W8,O6)
Threats:
1. Cement industry adopt to adopt
latest technology in Tiruchi
2. Lucky cement as strong
potential competitors.
3. Unhealthy industry competition.
4. Chinese investment in Dewan
group.
5. South Africa imposes duties on
Cement.
ST
Market development (t5,s7)
Increase Dividend for
shareholders (T5,S9)
Invest in
Maintenance. (T1,s9)
WT
High Promotion Campaign
(T4,W3)
Hire new HR manager
(w9,t3,t8)
Training of
employee(w8,t2,t3)
19. 19
The Strength-Weakness-Opportunities-Threats (SWOT) is an
important matching tool that helps the manager to develop four types of
strategies: SO (Strength - Opportunity), WO (Weakness –
Opportunities), ST (Strength - Threats), and WT (Weakness – Threats).
Matching key Internal and external factors.
SO strategies use a firm’s internal strength to take advantage of external
opportunities. Managers would like their organization to be in a position
in which internal strength can be used to take advantage of external
trends and events.
WO strategies aim at improving internal weakness by taking advantage
of external opportunities. Sometimes key external opportunities exist,
but a firm has internal weaknesses that prevent it from exploiting those
opportunities.
ST strategies use a firm’s strength to avoid or reduce the impact of
external threats. This does not mean that a strong organization should
always meet threats in the external environment.
WT strategies are defensive tactics directed at reducing internal
weakness and avoiding external threats. An organization is faced with
numerous external threats and internal weaknesses may indeed be in a
precarious position.
20. 20
The Internal–External (IE) Matrix
IFE Of OPC
Weight Rate Weighted Score
Strengths
Product Quality 0.10 4 0.40
High Production Capacity 0.09 3 0.27
Own Power Generation 0.06 4 0.24
Easy access to Financial Market 0.08 3 0.24
Solid Brand Equity 0.12 2 0.24
Weakness
Not Near Seaport 0.09 4 0.36
Low promotion Strategy 0.18 4 0.72
Transportation Cost 0.09 4 0.36
Limited Human Capital 0.10 3 0.30
No Performance Appraisal 0.09 4 0.36
1 3.49
EFE Of OPC
Weight Rate Weighted
Score
Opportunity
A growing market 0.09 2 0.18
Increased consumer spending 0.1 3 0.3
Legal changes which make selling abroad easier 0.09 2 0.18
Change in society 0.18 1 0.18
Income level is at constant increase 0.09 4 0.36
Threats
Government policy ban on some activities 0.12 4 0.48
Taxation rules which reduce the firm's income 0.08 2 0.16
Change in consumer habit 0.06 4 0.24
Increasing costs might be possible 0.09 3 0.27
New product change demand 0.1 4 0.4
1 2.75
21. 21
IFE Of SRC
Weight Rate Weighted Score
Strengths
Product Quality 0.10 4 0.40
High Production Capacity 0.09 3 0.27
Own Power Generation 0.06 4 0.24
Easy access to Financial Market 0.08 3 0.24
Solid Brand Equity 0.12 2 0.24
Weakness
Not Near Seaport 0.09 2 0.18
Low promotion Strategy 0.18 3 0.54
Transportation Cost 0.09 3 0.27
Limited Human Capital 0.10 4 0.40
No Performance Appraisal 0.09 3 0.27
1 3.05
EFE Of SRC
Weight Rate Weighted
Score
Opportunity
Govt. infrastructure spending 0.09 3 0.27
investmentinindustrialprojects 0.1 4 0.4
commercial constructionactivity 0.09 2 0.18
newtechnologiesare available atreasonable costs 0.18 4 0.72
emergingexportsmarkets 0.09 3 0.27
Threats
importsfromPakistanaffectingmarketsinnorth India 0.12 4 0.48
excessovercapacitycanhurtmarginsas well asprices 0.08 3 0.24
consolidationthroughmergersandacquisition 0.06 2 0.12
variedratesof royalty 0.09 4 0.36
risingoil prices 0.1 4 0.4
1 3.44
22. 22
IFE Of Clinker
Weight Rate Weighted Score
Strengths
Product Quality 0.10 4 0.40
High Production Capacity 0.09 2 0.18
Own Power Generation 0.06 4 0.24
Easy access to Financial Market 0.08 2 0.16
Solid Brand Equity 0.12 2 0.24
Weakness
Not Near Seaport 0.09 2 0.18
Low promotion Strategy 0.18 1 0.18
Transportation Cost 0.09 3 0.27
Limited Human Capital 0.10 4 0.40
No Performance Appraisal 0.09 3 0.27
1 2.52
EFE Of Clinker
Weight Rate Weighted Score
Opportunity
future growth potential 0.10 4 0.40
rising local demand 0.09 4 0.36
construction boom in Pakistan 0.06 2 0.12
focus on cost optimization 0.08 4 0.32
availability of finance 0.12 3 0.36
Threats
low per capita consumption 0.09 2 0.18
high incidence of taxes 0.18 4 0.72
decline in profitability 0.09 4 0.36
high input cost 0.10 3 0.30
inadequate bulk loading facility at ports 0.09 1 0.09
1 3.21
23. 23
The Internal–External (IE) Matrix
Division IFE EFE Sales 2016 Profit & loss
(PKR. Thousand)
Profit & loss %
Ordinary
Portland
3.49 2.75 3,111,346 11,762,688.17 11,762,688.17*100/29703758 = 39.6%
Sulphate
Resistant
3.05 3.44 2,851,345 10,158,685.24 10,158,685.24*100/29703758 = 34.2%
Clinker 2.52 3.21 3,507,230 7,782,384.60 7,782,384.60*100/29703758 = 26.2%
Total 29703758 100%
Strong
3.0 to 4.0
4.0
3.0
Average
2.0 to 2.99
Weak
1.0 to 1.99
2.0
1.0
1.
0
to
1.
99
3.0 2.0 1.0
High
3.0 to 4.0
Medium
2.0 to 2.99
Low
1.0 to 1.99
THE IFE TOTAL WEIGHTED SCORES
EFETOTALW.SCORES
POR 39.6%
3.49
2.75
3.05
3.44
SR 34.2%
Clinker 26.2%
2.52
3.21
24. 24
The Quantitative Strategic Planning
Matrix (QSPM)
New plant in
African continent
High Promotion
Campaign
Outsourcing
Opportunities Weight AS TAS AS TAS AS TAS
Demand of Cement increase 10% due to new developing projects in the
country
0.08 1 0.08 4 0.32 3 0.24
Increase in the demand of Cement due to Export increase by 5.72%. 0.08 4 0.32 2 0.16 3 0.24
The MOU b/w Pakistan & Iran on Eco. Corporation signed. 0.05 - - - - - -
Due to the stable growth of economy it leads DGK towards stable growth. 0.04 - - - - - -
Shutting down the one of the Lucky cement plant becomes the opportunity
for DGK to take his place.
0.05 1 0.05 4 0.20 2 0.10
Opening a new plant in Karachi is the opportunity for the DKG to increase in
the production and its sale.
0.06 1 0.06 4 0.24 2 0.12
Coal Prices and consumption is decreased in international market. 0.05 - - - - - -
Increase in utilization of cement due to CPEC projects. 0.09 1 0.09 3 0.27 2 0.18
Establishing manufacturing facilities in attractive foreign markets, especially
in African continent.
0.06 4 0.24 3 0.18 2 0.12
Market in Southern Pakistan. 0.05 - - - - - -
Threats
Cement industry adopt to adopt latest technology in Tiruchi 0.06 - - - - - -
Due to US bomb attackin Afghanistan the DGK cement export effect 0.04 3 0.12 1 0.04 2 0.08
Taxes increased due to taken fresh loans of $25 billion in last three years 0.05 - - - - - -
Inconsistent government policies. 0.06 - - - - - -
Increased GST by Rs. 100 on 50kg cement bag. 0.03 - - - - - -
Lucky cement as strong potential competitors. 0.04 1 0.04 4 0.16 2 0.08
Unhealthy industry competition. 0.03 3 0.09 2 0.06 1 0.03
Chinese investment in Dewan group (cement). 0.05 2 0.10 4 0.20 1 0.05
South Africa imposes duties on Cement. 0.03 - - - - - -
Total 1
25. 25
New plant in
African continent
High Promotion
Campaign
Outsourcing
Strengths Weight AS TAS AS TAS AS TAS
Excellent credibility & creditworthiness. 0.06 4 0.24 3 0.18 1 0.06
Solid brand equity 0.08 - - - - - -
Extensive dealer network. 0.06 - - - - - -
Easy access to financial markets. 0.04 4 0.16 2 0.08 1 0.04
Product Quality 0.08 3 0.24 2 0.16 1 0.08
Enterprise resource planning 0.04 - - - - - -
High production Capacity 0.08 - - - - - -
Plant’s geostrategic importance 0.06 1 0.06 3 0.18 2 0.12
Parent company’s diversified business segments 0.04 4 0.16 3 0.12 1 0.04
Own Power Generation 0.06 - - - - - -
Weakness
No physical presence near seaport & southern areas of Pakistan. 0.05 1 0.05 2 0.10 4 0.20
Limited skill set of human capital 0.06 1 0.06 2 0.12 3 0.18
Low promotion strategy 0.04 1 0.04 4 0.16 2 0.08
Reliability on weather 0.02 - - - - -
Transportation Cost 0.02 3 0.06 1 0.02 2 0.04
Health concern for employees 0.04 - - - - - -
Autocratic Decision making 0.03 - - - - - -
Job dissatisfaction 0.06 - - - - - -
No performance appraisal 0.04 - - - - - -
Fluctuating energy cost 0.04 2 0.08 1 0.04 3 0.12
Total 1 2.34 2.99 2.2