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Managing Human Capital and Entrepreneurship (Essay Sample)


In your role as a business coach, you provide advisory services for new entrepreneurs who are interested to set up a business. You have been approached by one such entrepreneur to assist in validating the viability of a new business
In your evaluation, you are required to
Task 1
• Define the business that has been established and discuss the business model of the business in view of the current business environment (approx. 400 words)
Task 2
• Critically evaluate the sustainability of the business and how the external business environment may influence the business model and strategy of the venture. (approx. 1200 words)
Task 3
• Critically analyse the Human Resource requirements and the HR strategies and determine whether the HR strategy is able to support the sustainability of the business (The HR strategies may be in the the key areas such as recruitment, selection, training, performance management and motivation) (approx. 1200 words)
Task 4
• Evaluate the key success factors of the business including the challenges and solutions to overcome these challenges (approx. 400 words)


Contents TOC \o "1-3" \h \z \u 1.Introduction PAGEREF _Toc45925802 \h 3a)Industry overview PAGEREF _Toc45925803 \h 3b)Company Background PAGEREF _Toc45925804 \h 4c)Business model PAGEREF _Toc45925805 \h 52.Macro environmental analysis PAGEREF _Toc45925806 \h 6a)Pestle analysis PAGEREF _Toc45925807 \h 6b)Porter’s 5 forces analysis PAGEREF _Toc45925808 \h 103.Human resource strategies PAGEREF _Toc45925809 \h 13a)Recruitment and selection PAGEREF _Toc45925810 \h 13b)Employee management PAGEREF _Toc45925811 \h 144.Critical success factor for the business PAGEREF _Toc45925812 \h 165.Conclusion PAGEREF _Toc45925813 \h 17References PAGEREF _Toc45925814 \h 19
1 Introduction
Through proper planning and management of human capital, entrepreneurs are able to set up businesses and make them successful in spite of all the challenges in startup businesses because the exercise helps entrepreneurs understand different factors or forces that have an impact on the new business and how its success affects the environment. This report will focus on a new car dealership business startup (Hubbmotors Company) in the automotive industry in Kuala Lampur, Malaysia.
* Industry overview
The automotive industry results to the passenger automobile and truck manufacturers. The industry has many dealership networks which focus on the global market especially to the developing country markets. Different models are offered by the automotive manufacturers although brand integration is limited at the dealership levels as well as the advertising and marketing levels. Most of the companies have operation production facilities in different regions which cover a large customer base. This industry is highly affected by the economy stability because most of sales are recorded during economic booms and low sales recorded during the downturns of the economy. The economic cycle force shifts in the driving habits to meet demands as a result of technology, innovation and new model development and this forces car dealer to showcase wide variety of cars to meet every clients taste and financial capability.
Never the less this is one of the industries that is labor intensive and has high operational cost associated with product development, spare parts, material and employment.
152400000Figure 1: vehicle sales in Malaysia (source:
* Company Background
The Hubbmotors Company will be located in Malaysia in the city of Kuala Lumpur and will deal with a mix of different car brands to cater for a wide range of customer base. These brands will range from those affordable to low income earners up to the high income earners. Some of the top brands to focus on will be Datsun, Toyota, Ford, Mercedes-Benz, Mazda and Peugeot among others.
Further, most of the focus will be on the locally manufactured brands like the Perodua, Toyota Vios and protons which are the common cars in the Malaysian streets and are affordable. The company intends to collaborate with the local manufacturers for supply of the vehicles and their spare parts, some of those manufacturers will include the Tanjung Malim Protons Plant, Honda Malaysia, Perodua Rawang and Tan Chong Motors
* Business model
The Brick-and-Mortar business model will be adopted because the entrepreneurs will directly interact with the customers (Abdih and Joutz, 2018). To ensure profit maximization the business will combine selling of both new and used cars and offer after care sales.
For the new cars, the entrepreneurs will sign a dealership agreement with the franchisors whose main focus are usually market share hence to maintain this level there will need a very hard working marketing team to maintain the required levels of sales which makes this one of the risks associated with the car businesses because if the required sales are not made the entrepreneurs are usually in trouble with the franchisors.
Due to the risk associated with the sale of new cars, incorporating used cars will be great to cover up for those risks because the franchisors are not involved in the second hand cars. Most of the people in Malaysia are middle class and affording new cars is a challenge hence giving them an opportunity to purchase used cars is the best choice since they are more affordable and the business could sale more units compared to the new cars.
Additionally, most people prefer some modifications to the cars they buy which are usually done at extra cost. These modifications include adding window tints as well as floor mats hence incorporating this as an after care sales will add to the profits the Hubbmotors Company will make.
0254000Figure 2: vehicle sales in different countries (source:
2 Macro environmental analysis
These are the external factors that affect the whole industry. To better understand these factors, different models are used. For this particular business, we will adopt the pestle model to analyze the environmental factors as well as the porter’s 5 forces for competitive analysis in the automotive industry.
* Pestle analysis
This new venture’s ability to successfully address the external factors in its macro environment will help make it successful in this automotive industry (Amidon, 2020). Through this model, the entrepreneurs will be equipped with the knowledge on how the business will be affected by the environment, hence help in the development of strategies to exploit the identified opportunities as well as ways of overcoming the threats in the industry.
Political factors
The government’s impact, as well as its programs and actions on the industry will affect the business. Some of the political factors that the business should be prepared to encounter include the government advocacy on public transport which is a threat to the business because many people will prefer using the BRT and the ERL to self-driving and this could reduce the sales. Additionally the government’s aggressiveness on combustion-type cars tax policies is also a threat because this raises the car cost making them unaffordable to most of the people. On the positive side, Malaysia is politically stable country hence this is an opportunity for the business to thrive without political disturbances.
1409700000Figure 3: 2020: vehicle usage in Malaysia (source:
Economic factors
This new venture will highly depend on the condition of the economy in the country. For a start the Malaysian economy is growing at a very high rate as shown in (figure 4) and this will give the venture an opportunity to pick and grow quickly. Further, the country’s economic issues are minimal making the general economy stable and this will be an opportunity to the new venture, despite those opportunities, there are many car dealers in the region which will be competitors with the businesses considering most of them are already running businesses who have a wide customer pool, hence the entrepreneurs will have to come up with strategies on how to deal with the competitors and thrive in the market amidst the challenge.
1133475000Figure 4: The economy growth in Malaysia (source:
Social/Sociocultural Factors
The social conditions and trends will also affect the new venture. These factors are key determinants of consumer and employee behaviors in the business. Most of the people have shown interest in the electric vehicles and hence the business can use that as an opportunity to deliver those cars to the Malaysian people. Further, many people have developed the habit of preferring self-driven cars which will be an opportunity for the business because it means that the demand for cars is shifting upward. However, increased demand in vehicle sharing programs like the use of uber and taxes could impact the business because many people would vie at as less expensive interns of fuel consumption cost hence reducing the sales.
Technological Factors
The company will use technology for competitive advantage strategy development as well as for its operations; there are different technological conditions and trends that will affect the venture. Improvement of self-driving vehicle technology is one of the opportunities available for the business since their demand has been on the increase and adopting such vehicles as one of its base stock will help the business growth in the sales.
Ecological/Environmental Factors
Environmental changes and trends can affect the usage of products, supply chain as well as availability of resources. Changes in the climatic patterns make it hard for people to travel but the company could use that as an opportunity though marketing its vehicles which could help convince its clients of the convenience of having a self-driven car while travelling. Due to increased concern over the impact of motor vehicle emission to the environment, the business venture could use that as an opportunity and stock cars that are compliant.
Legal factors
The business wills definitely be influenced by the legal system of the country through laws and regulations that govern the businesses in the industry (Bellingham and Campanello, 2016). Some of the factors are the existing regulations on safety which the business will use as an opportunity because by staying compliant with the regulation will be enough to convince its clients that the cars from their store a...

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