Evaluation of the suitability of strategic options at Qinos : Franchise or outsource?
The political processes with regards to black economic empowerment creates a very favourable business environment both for start-ups and already established black companies The service industry is the fastest growing industry around the world. In South Africa, the demand for technically skilled technicians in the information and communication industry is huge. III The challenge facing most black start-up is the sustainability of these companies in view of changing economic, political, social.and indeed technological environment. Franchising has been hailed as the best business growth strategy in many countries and particular for black owned small businesses in South Africa. The Franchise Association of South Africa is the authority with regards to franchising in South Africa. The Association has developed detailed and easy to follow guidelines towards franchising. Outsourcing non-core business activities enables a company to focus on its core business. Once a company focuses on its core business, it is then able to save on operational costs, focus on developing new products and offering better services. Both business-format-franchising and outsourcing are not perfectly suitable for Qinos ,and/or sustainable in the long run. The recommended strategic option is outsourcing with a mentoring programmed embedded in the strategy implementation, herein referred to as the hybrid strategy. The hybrid strategy suggests the creation of a network of subcontractors to whom Qinos shall out source some of its activities. The Subcontractors Network shall be a strategic alliance offield service providers in the ICT sector based in KwaZulu-Natal, initiated and mentored by Qinos. Qinos shall manage outsourced operations on behalf of companies that are outsourcing their field maintenance services, in the ICT sector, to these credible SMEs. The Subcontractors Network are small, owner-managed black owned companies that can provide the basic infrastructure for running a field maintenance service in the ICT sector. They have the competencies or are able to acquire the vendor-required competencies within a short period of time not exceeding six months. They provide world-class service quality, are profitable and sustainable.