GoTech is a Saudi company

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GoTech is a Saudi company (located in Riyadh) that provides technical and digital solutions to other businesses and individuals. Its operation focuses mainly on the Saudi market, but recently it opened two offices in Egypt and Italy. Eng. Abdullah is the CEO, and there are three regional managers (in 3 different countries) and 30 employees working under their supervision.
Recently, Abdullah has been required to make vital decisions to keep GoTech running during many challenges, including new and existing competitors, rapid technology development, and Coronavirus pandemic. Consider yourself the CEO’s consultant who is required to help him put together a strategy so GoTech can not only survive but also thrive in the future.
To help you develop your Consultation Strategy Report, use the following points as a guide:

Part 1
1. An overview of GoTech company (0.5 marks)
2. Description of the type of management that GoTech follows. (1 mark)
3. Description of the challenges with that type of management. (1 mark)
o Communication challenges
o Cultural and political challenges
4. Description of the necessity for creating a virtual Risks Response Team based on Tuckman’s Team Life Cycle Model (see figure 1). (3 marks)
o Phases of team creation
o Criteria for choosing the team
 Who are they, and why did you choose them?
o Pros and cons of the virtual team
5. Description of the regional managers’ roles (2 marks)
o What qualities must they have as leaders?
o How can they motivate themselves and their team?
o What digital recourses can they use to manage the team?

 

Sample Solution

y and maximise on savings. Paradoxically, a similar concept in service provision carries a ‘loyalty penalty’ for British consumers, who are losing out on £4bn a year (CMA, 2018). Firms exploit uninformed customers, by discriminating between them. Contrastingly, naïve consumers become complacent and blindly trust their current suppliers, whilst those that may be aware of such practises are deterred away by high search or switching costs.

In an environment where consumers are loyal, hence have an inelastic demand, or are simply uninformed, due to the presence of search costs, firms can choose to employ second and third-degree price discrimination. For example, British Gas offers a range of tariffs dependent on your needs, location etc. for electricity usage.

I illustrate how firms manipulate prices by adopting the Stahl-Varian model. We can change the assumptions from the original model so that the informed customers, I, are new customers, and the uninformed customers, M, are old customers. Thus, the uninformed customers will have a search cost, c, if they look for cheaper service providers. The other assumptions remain the same; all consumers have the same reservation price, r, and there are n symmetric firms in the market.

The number of old (uninformed) customers per firm, U, is exogenously given by:

Firms choose prices between p*, which equals to the marginal cost, and r. Informed customers have knowledge of prices provided by firms, thus, they will only buy from the cheapest firm.

The firm will sell to I with probability:

The firm will sell to M with probability:

Therefore, the firm’s expected profits are given by:

In a competitive market, firms behave in a way to maximise profits. Gamble et al., (2013), suggest firms are cognizant of customer costs; they recognise when customers are likely to switch. In this case, they will lower their price so that the price difference between theirs and rival prices is less than the search and switching costs, thereby stopping customers from switching.

The firm sets prices to maximises profits:

The derivative helps us find the profit maximisation pr

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