Malaysia’s Herbaline Facial Spa: A Human Resource Strategy For Growing A Startup Harvard Case Solution & Analysis

Malaysia's Herbaline Facial Spa: A Human Resource Strategy For Growing A Startup Case Solution 

Problem Identification

Herbalineis a Malaysian – based beauty salon chain. The founders of Herbaline, Mr. Low Chee – Kwong and Ms. Liu Kim – Hwa,focused on the philosophy of the “stress – free” facial spa.In the path of success, Herbaline was developed by retaining its philosophy. However, the outlets of Herbaline increased from 1 in 2000 to 55 to 2014.Nonetheless,, the organization is now headed towards the growth of its outlets up to 100 by 2012.Herbaline, thus, had to choose among its strategies while maintaining its competitive strategy, culture for management and cost leadership.

Herbaline carried out some supports of the operators in 2000. Moreover, the operator became franchises and became franchises of the Herbaline.Since the franchise owners were not of the retained and trained employees of the Herbaline’s owner’s owned outlets, therefore, the services of the franchises were not of the standard that the owner operated outlets used to maintain. Nonetheless, there was a risk to the brand reputation of the Herbaline. Hence, CK and Kim planned to carry out the services of franchises maintaining their core strengths. A profit sharing scheme thus, was developed in order to achieve further growth.

With the strategy of implementing their core strengths at each franchise, CK and Kim employed the retained and trained employees of the Harbeline’s outlet at franchises. Moreover, the employees were able to maintain the services of the franchise services as per benchmark of the operated outlet.The growth of the franchises was brought up with the two main hurdles. The founders felt that the brand reputation of the company has sustained through the profit sharing scheme, however, the possibility of management conflicts of Human Resource practices increased. Ck and Kim had carried the culture of organization during the years of Herbaline growth. Furthermore, it was the competitive edge for Herbaline that it had retained its employees with the best practices of human resource at its outlet. Thus, the issue appeared to CK and Kim was challenging growth of the human resources with the growth of franchises.

Another constraint to the reputation of the Herbaline was its cost leadership that had influenced through the enhanced techniques of achieving its competitive edge. Herbaline needed to sustain its competitive edge of “Stress – Free” services. Hence, Herbaline had to renovate its pricing strategy in order to remain competitive. The low price strategy could cause low profitability of the company or could influence service quality.

SWOT Analysis  Case Analysis

The SWOT Analysis comprises Strengths, Weaknesses, Opportunities and Threats. It is the study of Internal Environment and External Environment of an organization. The Internal Environment is demonstrated by the Strengths and Weaknesses of the company. Moreover, the External Environment deals with the Opportunities and Threats of the organization.

Strengths

Herbaline has proceeded with the following eempowerment in its organization.

1.      Pricing Strategy

The services of 5-Star products were delivering at the price of 3-Star commodity. Without any promotional packages offer the services were rendering by Herbaline.The price range of the Herbaline was RM69 to RM149 which was much cheaper than the average charges in Industry.

2.      Products

The products used by Herbaline were all natural products. The natural extracts of the plants were the specialty of the Herbaline services. The natural products were able to make customers feel peace in their mind. However, the other saloons had the flavor of hazardous chemicals like peeling acids in the massage products...................

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