Multiple Choice • focused differentiation • low-cost • high-cost • unifying • Whenhypercompetitionsituationsoccur repeatedly,
_______
Strategy
and standard
MGT 526 Wk 2 Managerial Planning and
- Practice:
To maintain profits while offering the best industry pricing to customers, a furniture company decides to order materials in larger quantities to realize larger discounts on materials. The company is employing a _______ strategy. organizations can develop plans to outline policies, rules, operating procedures (SOPs) on how to handle those situations.
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Multiple Choice • single-use • functional • rolling • standing • scenario The intermediate- and short-term plans created within a work group typically address the _______ goals and strategies of an organization. Multiple Choice • functional • business • divisional
Multiple Choice • divisional-level • departmental-level • functional-level • corporate-level • Easternbusiness-levelRegionVice President Goodall works with her team of sales managers to develop a _______ plan, which defines the strategies, goals, and structure associated with achieving the company's objectives in the Eastern region of the United States.
Multiple Choice • business-level • corporate-level • functional-level • departmental-level •
• standing • short-term
SWOTSkipRequiredglobal-levelinformationtoquestionAnalysisSaves
• rolling • contingency • single-use In a small developing country, the percentage of the population switching to cellular technology in recent years has been rapidly increasing. A multinational telecommunication services company decides to take advantage of this change by installing network infrastructure and establishing a sales presence in that country. This is an example of a _______ strategy.
the Company! SWOT analysis is a planning exercise in which managers identify internal organizational strengths (S) and weaknesses (W) and external environmental opportunities (O) and threats (T). Based on a SWOT analysis, managers at the different levels of the organization select the corporate, business, and functional strategies to best position the organization to achieve its mission and goals.
• corporate • global A _______ plan is generally reviewed and amended in conjunction with a company’s annual financial budget cycles to take into account changing conditions in the external business Multipleenvironment.Choice
Also, Conant noted that Campbell had a conservative culture in which people seemed to be afraid to take risks—something that was a real problem in an industry where customer tastes are always changing and new products must be developed constantly. At the same time, the SWOT analysis identified an enormous strength: Campbell enjoyed huge economies of scale because of the enormous quantity of food products that it makes, and it also had a first-rate R&D division capable of developing exciting new food products.
In this exercise, you will learn how Douglas Conant turned around the failing Campbell’s Soup Company by implementing strategies developed from the results of a SWOT analysis. This will help you understand both how to perform such an analysis and to understand its value. Read the case below and answer the questions that follow.
With the analysis of the environment complete, Conant turned his attention to his organization’s resources and capabilities. His internal analysis of Campbell identified a number of major weaknesses. These included staffing levels that were too high relative to its competitors and high costs associated with manufacturing its soups because of the use of outdated machinery.
Campbell Soup Co., one of the oldest and best-known global food companies, saw demand for its major product, condensed soup, plummet by 30 percent between 1998 and 2004 as customers switched from high-salt processed soups to more healthful low-fat, low-salt varieties. Campbell’s profits and stock price plunged as its condensed soup business collapsed, and in 2001 its directors brought in a new CEO, Douglas Conant, to help the troubled company. Conant decided it was necessary to develop a three-year turnaround plan to help the company strengthen its market position against aggressive competitors such as General Mills, whose Progresso Soup division had attracted away many Campbell customers with its innovative new lines of healthful soup. One of Conant’s first actions was to initiate a thorough SWOT planning exercise. External analysis of the environment identified the growth of the organic and health food segment of the food market and the increasing number of other kinds of convenience foods as a threat to Campbell’s core soup business. It also revealed three growth opportunities: (1) the growing market for health and sports drinks, in which Campbell already was a competitor with its V8 juice; (2) the growing market for quality bread and cookies, in which Campbell competed with its Pepperidge Farm brand; and (3) chocolate products, where Campbell’s Godiva brand had enjoyed increasing sales throughout the 1990s.
Using the information from this SWOT analysis, Conant and his managers decided that Campbell needed to use its product development skills to revitalize its core products and modify or reinvent them in ways that would appeal to increasingly health-conscious and busy consumers. Conant stressed convenience with microwaveable soups and cans that open with a pull. The recipes became more healthful for its soups, V8 drinks, and Pepperidge Farm snacks because Conant needed to expand Campbell’s share of the health, sports, snack, and luxury food market segments. Also, to increase sales, Campbell needed to tap into new food outlets, such as corporate cafeterias, college dining halls, and other mass eateries, to expand consumers’ access to its foods. Finally,
Conant put his new plan into action, sales of new soup products increased, and he began to put more emphasis on sales of soup at outlets such as 7-11 and Subway and less on supermarket sales. By 2005 analysts felt that he had made a significant difference in Campbell’s performance but that there was still a lot to do—Campbell’s operating margins were still shrinking. Carrying on the SWOT analysis, Conant decided Campbell should produce more products to meet the needs of the “low-carb diet,” such as new kinds of low-carb bread and cookies. He also decided to shrink the company’s operations to lower costs. His goal was to raise profit margins to the level of his major competitors, Kraft and General Mills, by 2007 using a new three-year plan based on this SWOT Byanalysis.2007 Conant had substantially achieved his goals. Sales of soup had recovered and the Pepperidge Farm and Godiva divisions were earning record sales and profits. (Sales of Goldfish crackers had increased by 100 percent!) Campbell’s stock price soared, and Conant and employees at all levels received bonuses that rewarded their intense efforts to turn around the company. However, Conant immediately set in motion a new round of SWOT analysis to find fresh opportunities for developing new products. Customers’ changing demand for more healthful, low-salt soups was a(n) _______ Campbell. Multiple Choice • opportunity for • SWOT for • threat to • strength of • weakness of The growing markets for health and sports drinks, quality bread and cookies, and chocolate _______ Campbell. Multiple Choice • were areas of weakness for • threatened the core business of • were not really relevant to
Conant decided to decentralize authority to managers at lower levels in the organization and make them responsible for developing new soup, bread, and chocolate products that met customers’ changing needs. In this way he hoped to revitalize Campbell’s slow-moving culture and speed the flow of improved and new products to the market.
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• were already being exploited as strengths at • presented opportunities for growth for Which elements were parts of Conant’s examination of the external environment facing MultipleCampbell?Choice • analysis of opportunities and threats • analysis of strengths, weaknesses, opportunities, and threats • analysis of weaknesses and threats • analysis of opportunities and strengths • analysis of strengths and weaknesses
The most important part of the SWOT analysis at Campbell was the Multiple Choice • strategy Conant put in place as a result of the analysis. weaknesses segment. strength segment. opportunities segment. threats segment.