BS2158 International Business

Introduction:

The transportation sector is a broad bracket under which other independent ones are present such as airlines, railroads, trucking companies and similar others. It is an energy consumption based sector which majorly depends on vehicles. The primary pillars of this business sector are dependent on public, as the sole purpose of the sector is to transport people or goods from one location to another. The sector includes automobiles such as cars, trains, subways, aircrafts, ships, and other vehicles. The main goal of this sector is meeting all the expectations of the customers relating to transport issues. This sector is very closely related to the sensitivity of the price of fuel. The hikes in pricing of fuels directly affect the business of the sector. The following report discusses in details the business, market, growth history, location advantages and factors alike of the company names FirstGroup. This company is a British transport company registered and functioning in the United Kingdom.

The company also provides its services in other countries like Canada, United States and Ireland. The report stresses on the business scenario of the company in the United States. Known as First Transit in North America, the company is one of the biggest public transport management companies in North America. The First Vehicle Services sector under the company’s wing works as one of the largest providers of maintenance of vehicles. They also have a number of bus services around the country. The list of customers of the company includes authorities such as local transport departments, state transport departments, private institutions, colleges, universities, airports and hospitals. They have been trusted expert service providers for more than 60 years. Their expert team of equipped managers ensures that their business is on a high and they gain the goodwill of people. They have very strong core teams which work to maintain the competitive atmosphere in the market as far as other transport companies are concerned. Their untouched reputation for excellence, safety and professionalism gains them the best reviews from their customers.

Political/ Economic background, USA

The United States of America is in possession of a strong democratic system and an effective legal system. The elections that are held are transparent and the involvement of the public is fair (Deutsch 2015). The country has massive economic and political influences over policymaking, globally. It is a superpower in the world. However, international criticism is not something that they can steer clear from. This is in regard with the policies regarding ‘War on Terror’. Many foreign relations are being soured due to the decisions, at the same time terrorism threats are on the rise. Canada possesses a strong democratic setup, and has also taken up free trade negotiations with countries like the Americas, Europe and other places to help their economy grow. The country also encourages agreements allowing free trades with regions adjacent in order to protect double taxation, foreign investment, and to strengthen financial institutions (Vuchic 2005).

Economy wise, the United States of America is the largest economy in the world, with a GDP of over $16.760 trillion. They have a well rounded economic system which is fed by the industries. Although the economy was affected after the 2009 recession, but it shot back to stability in 2014 by growth of 4% (Hall 2010).

The United States of America has an economy that is based on innovation and technology. Since the beginning, the country has been a leader in ways of adapting technology, and applying the same. The country is expected to retain its hold in terms of economy in spite of facing constant pressure from competing economies.

FirstGroup as a company operates with a broad footprint in the United Kingdom. The company’s mark in the market of the United States of America is also very noticeable as it contributes much to the economy. Having a market in the United States of America gives them expertise and experience over one of the most developed economies of the world. Transportation industry in the United States of America is very competitive. Investment in this sector, have helped several multinational firms to position themselves better, allowing better flow of goods all over the world's biggest consumer market (Winston 2013). Both international and domestic sectors under this industry are aided with a skilled workforce and comparatively low costs. America has a very well blended supply chain network that links consumers and producers effectively through multiple modes such as express and air delivery services, truck and maritime transport. Transport companies provide tailored solutions to the people to make sure each consumer’s need is catered. It is very important for each company under the discussed domain to work according to the political and economic scenario of a country in order to function smoothly. The company has a competitive advantage because of their scale and portfolio that they have created in the market. They look after the operation of hundreds of networks and make the outlets function to the best of the abilities (Rose 2012). The political agendas allow the growth of the business market of the country, as it is mandatory for any company to abide by the rules and a slight change in the political scenario of a country affects the business market. The United States of America having an economy as enormous as that is suited to support a business like that which is public based to the core. The company has been extremely wise to set up business in the United States’ market, which has a huge reach. Stakeholders in the United States are working with the company, knowing that the company has access to the vast market and is equipped with some of the finest brains for business (Golob, Kitamura and Long 2013).

Location Advantage

The Porter’s Diamond method can be decoded as a way to understand the factors that create an industrialized country’s competitive advantages. The visual of the graph is like that of a diamond which is used to pinpoint the factors resulting to the advantages of a business (Nail et al 2013). The factors are:

• competition in the industry
• power of suppliers
• potential entrants
• power of customers
• threat from substitute products

There are never less reasons for investors to choose the United States of America for setting up business, given any sector. Beginning from the friendly business environment to the lifestyle standards, to technological advancement, the United States of America is excellent. Supply chains, workforce and infrastructure are also at par with the global standards. One of the best qualities of the nation is that it is very open to outside investors. Business from outside the country is allowed to set up, make a place in the market and thrive, and sometimes make it very big. The United States of America provides the largest consumer market in the world, with a GDP of $18 trillion, and 323 million people. The Country allows free trade agreements to other countries which allow access to more than millions customers. The exporters of the nation have more possibilities when they are setting up their business in such a huge platform. The importers who set up ties to have a business setup utilize the same convenience. The United States of America is home to some of the most renowned universities and business schools of the world, which produce some of the best business and brilliant brains. Business is always beneficial in a place that is the hub of technological brilliance and rich in intelligence capital. Various companies small and big help to make the United States a global enterprise that benefits from and also contributes to the world market. Factors like labor and market demand is also looked after when business is taken into consideration, due to the large population of the United States. Infrastructure and network wise also, the United States of America is never a step back- in fact it is one of the leading nations. Social factors like climate, lifestyle, image and crime rates also contribute to the factors affecting business in a country. Because the United States of America has to be widely connected for commercial as well as personal purposes, it gives transportation a very important space. A well-tailored transportation system is very important for a big nation. So investing on a sector such as transportation, in nations like these is a success recipe. The FirstGroup as a company has carefully taken into consideration these factors when they had set up ties with the United States expanding beyond their United Kingdom startup (Go2hr.ca 2017).

The probable competitors of the company in the United States would be:

• Arriva plc
• Atlantic Express Transportation Corp
• The Go-Ahead Group plc

These companies are almost doing similar business and somewhat applying similar ethics to sustain their lives in the market (Hoovers.com 2017). Their excellence can be competition and probable threat to  FirstGroup. But the company has established a ground where they function with 124,000 employees and transport about 2.5 billion passengers. They have highly trained staff that ensures that training and quality in service is not compromised. Their establishment in United Kingdom has already given them the platform and status in the global market. Expanding based on the United States just added to their vastness and brand reputation. Being an industry that is based wholly on customers, FirstGroup has done justice in the way they have provided service.

Market Entry

For any transportation sector, transport links are very important for the growth of the company. People will always need to travel to destinations in their daily lives, for professional reasons or personal. It is wise on any company’s part to understand the population of the country they are setting up in and the requirements of the people there. Setting up the business to serve the people best would yield the best results (Doherty 2007). FirstGroup succeeds in responding to the needs of the customers. They follow certain unique characteristics given any of their markets, but there are a few themes. They are:

• Environment- People in large masses are moving towards urban habitats almost every day. People cannot always afford personal cars. Bus and rail services or rather public transport services come handy at situations like these. Some families can also leave their cars back at home and use the bus services or rail. This helps them a great deal on a daily basis. Also, the company ensures that pollution records are kept under check and they contribute enough for a better environment.
• Urbanization- With the advancement of the world, things have changed. The concept of urbanization has come into light. Transport links between the cities is very important, as the people have to commute for work purposes to the urban areas. Targeting the population influx to set up a business in transportation is a beneficial idea.
• Demographic changes- The chunk of community like senior citizens or maybe the handicapped majorly depend on the public transport system to travel. Other than that, a large number of urban people are choosing not to drive to work or across the cities, to avoid the labor or just the maintenance of a car. The company sets up its market keeping in mind this mass (Toth and Vigo 2014).
• Service standards- The most important aspect of any business is the goodwill a company creates. Transparency with customers about the service they provide is very important for a company to maintain. All these, along with a good market study can make any company reach the heights of success. When it comes to an industry like this, it is very important to remember that the whole business is dependent on the needs of the customers (Hinz and Hinz 2017). In an urban world, the needs of the customers keep changing, and evolving the policies of the company according to the dynamic customer needs is very essential. The services should offer flexibility in terms of ticketing, onboard amenities, understanding other needs of customers. FirstGroup as a company has always taken care of the above-discussed themes and that has brought them under the light they deserve in the global market (Johnson et al 2013). They have always ensured that the company worked with unified sense of ethics that is specific to their main branch. The head authority monitors every activity and performance as quality of service is very important to maintain. They set the strategic decision, allocate capital, sorts targets, and monitors overall activities. They have ensured that their customers get the best services from their ends (Johnson et al 2013). They have been handling the competitiveness from other companies but developing their business abiding by these themes has secured their place in the competitive market. A good focus on threats and risks helps the company focus on market pressure better.

Mode of Operation

Every company has its own set of rules and guidelines that they follow to ensure the best out of the market. Whenever a company enters the market, it usually follows maintenance of a couple of factors, which help in smooth working of the company (Stevenson and Hojati 2007). The factors would be :

• Operation Management
• Human Resource Management
• Marketing Management

These three points can be considered as important pillars on which the success of a business directly depends.

When one talks about Operation one talks about the part of a company or organization that deals with the smooth functioning and journey of an input to an output in terms of services. In all this process, the required quality of the service is taken care of. The act of transforming resources into value added services, abiding by the clauses of the organization is called management. The whole term ‘Operation Management’ refers to the administration of services for getting the best efficiency within an organization. Materials and labor are used in the most effective way to ensure that the company has the highest profit. Operations Management is very essential in developing the productivity of any given business. It shows the way for a company towards achieving the best output from minimum effort (States, Weiner and York 2017).

The other factor, which is important for any organization, is a good HR department. Although it might not always seem like something very important to the organization, it actually is. There are many tasks that rest upon the shoulders of an HR. On these, the standards of the organization depend (US Department of Transportation 2017). Some of them are:

• Monitoring the overall talent management procedure- The HR is responsible for the general management of tasks, performance of candidates, career planning and other talent management related stuff. Although the HR works with other team heads, it does not demean the function of an HR individually.
• Recruiting- One of the most important parts of any company is the employee group. The reputation of a company depends largely on the kind of employees it hires. The better the workforce, the more success the company sees. One of the primary works of the HR is to carry out the hiring process. Identifying the most suitable workers for the company and guiding them towards building an effective team is the work of the HR.
• Keeping a tab of the market rates- The HR keeps a tab of the market rates and shares. This helps during the hiring process, and creating an overall strategy regarding the salary packages of workers, keeping in mind the profit of the company. In fact, the HR is the person who manages strategies that attract and retain the finest employees. This is very important for maintaining the best team for the company. The HR also looks after every opportunity that can be utilized for the growth of the employers, and in the end, the company (Liu and Jiang 2012).

The last point that needs to be discussed is Marketing Management. The process that oversees and plans new product and service development in a company is called Marketing management (Hollenson 2015). One of the most important parts of marketing management is the maintenance of reputation of the brand. The marketing management team also looks after the branding, promotion and sales of the product/s the company is selling. The teams look after initiating the best ways to put forward or project the products of the company to ensure that the public stays interested and the sales go higher.

FirstGroup has always been a company that has taken care of its branding and image in the market. The company started applying a standard typeface to the names of its fleet in the 1990’s, introducing an ‘f’ logo which was stylized to look like a road. The buses where in white, pink and blue combination and where called ‘Barbie’ (new buses) . In the year 2012 the company began introducing a new kind of purple, white and lilac livery to the bus fleets. This reinstalled the local branding of the company, which was restricted earlier. In North America, all the owned and operated services work under the First brand.

The FirstGroup has taken over 470 locations in the United States of America and Canada where they work with school districts, providing safe transportation at an effective cost (Hollensen, S., 2015). The company operates more than thousand contracts, which have 3 to 5 years duration. The employment policy is sound and they employ around 50,500 people. They also provide services for non-school organizations or sports purposes. For over a century they have been providing top class transportation solutions and lead the best position in the industry. They have putting an effort to maintain their goodwill and sound relationship with their customers over the years. Working with school officials, locals, and people from other occupations, their understanding of the customer requirements is very sound, which helps them in smooth management (Eurofound.europa.eu. 2017).

Conclusion:

From the above report, it can be concluded that FirstGroup has always succeeded when it has come to providing the best transport services, irrespective of which country they are working in. Their goodwill and quality of service, teamed with brilliant marketing strategies have always had them at the top. Keeping a tab of the worlds around and forming policies accordingly has helped them flourish in all these years. They have faced challenges and competition from contemporaries but their sound strategies of management have always ensured that they hold the top position. Their mode of operations has always been well calculated, and the above report provides instances of that.

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