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Transcript of Waqas analysis
IMSciencesThe Craft Food, INC.
By: Waqas AhmadMBA 1.5
The Craft Food Inc
• The Craft Food Inc. is an international diversified (150 countries in
the World) company dealing in the foods and dressing products.
• The company currently consists of five operating segments
Snacks, Beverages, Cheese, Grocery and Convenient meals.
• Total Sales $42,201 Millions and net income is $1.95 Millions.
Harold Wallace• Founder, serves as Chairman and President of the
Wallace Group, owns 45% of the outstanding stock.
• Several years ago, Wallace and the Board embarked
on a strategy of diversification into plastics and
chemicals in order to decrease the company’s
dependence on defense-related business.
• Presently, the morale within The Wallace Group has
• Wallace has hired Frances Rampar, a management
consultant, to conduct a management survey into
the problems facing The Wallace Group.
Internal and External Analysis
Diversification Decreasing distinctive competence
Latest technology Scarce technical personnel
Opportunities ThreatsPotential in market Competitors
Internal Strategic Factors Weight Rating Weighted Score
Diversification .10 3 .30
Good reputation .10 3 .30
Latest technology .20 4 .80
Well-integrated .10 4 .40
Favorable market niche in electronics .05 3 .15
Decreasing distinctive competence .05 1 .05
Scarce technical personnel .10 2 .20
Heavy dependence on government contracts .10 2 .20
Unprofitable chemical division .10 2 .20
Leadership .10 1 .10
TOTAL SCORES 1.00 2.70
• The IFE total weighted score is 2.70 which is above the
average score of 2.5, indicate that the company has strong
internal position, which mean that the company has the ability
to minimize his weakness and properly utilize their strength.
External Factor Evaluation (EFE) Matrix
External Strategic Factors Weight RatingWeighted
Potential in market .70 3 2.1
Competitors .30 3 .90
TOTAL SCORES 1.00 3.00
• The EFE total weighted score is 3.00 which is above
the average score of 2.5, indicate that the company is
responding in an outstanding way to existing
opportunities and threats in its industry. In other
words, the firm’s strategies effectively take advantage
of existing opportunities and minimize the potential
adverse effects of external threats.
Competitive Profile Matrix (CPM)
• CPM is not applicable in this case study due to the insufficient information.
• The firm does not have a clear mission.
• Company heavily dependent on defense-related business
• Poor organizational design creates span of control
problems and results in poor operations.
• Unprofitable chemical division needs new management
or it needs to be analyzed for sale to someone else.
Major Problem• Lace of Leadership
Harold Wallace is found to be the major problems because:
– Some of the employee stockholders made an attempt to force Wallace’s
– Tremendous dissatisfaction among management and employees resulted
from Wallace’s failure to delegate to subordinates and a lack of clear
strategies or long term plans, goals, or objectives.
TOWS Analysis or SWOT Matrix
Strengths – SS1. Diversification
S2. Good reputation
S3. Latest technology
Weaknesses – WW1. Decreasing distinctive
W2. Scarce technical personnel
Opportunities – O
O1. Potential in market
Threats – TT1. Competitors
• S2O1: Through product development they can increase there market shares
• W1O1: If Wallace Group able to maintain their distinctive competence they
can take advantage from market potential. (Market penetration)
• S4T1: The Wallace Group has Well-integrated they are able to supply many
of its own component parts and raw materials. (backward integration)
• W1T1: If they introduce new product in the market they may able to avoid
the threat of competitors. (Product development)
SPACE MatrixFinancial Strength (FS)
Cash flow : 5 Liquidity : 4 Leverage : 3
Competitive Advantage (CA) Market share : -2 Customer loyalty : -3 Control over suppliers & distributors : -3
Environmental Stability (ES) Technological changes : -3 Competitive pressure : -3 Barriers to entry : -4
Industry Strength (IS) Growth potential : 5 Profit potential : 3 Ease of entry into market : 2
Y axis: FS + ES 4 + (-3.33) = 0.67
X axis: IS + CA3.33 + (-2.66) = 0.67
-3-2-1-6 -5 -4 -3 -2 -1 +1 +2 +3 +4 +5 +6
The company is in an excellent position to use its internal strengths to take advantage of external opportunities, overcome internal weaknesses, and avoid external threats.
• The Boston Consulting Group (BCG) Matrix is not applicable
in this case because the information require for BCG matrix in
not available in the case study.
IV V VI
VII VIII IX
IFE Weighted Scores4.0 3.0 2.0 1.0
Hold and maintain stage, Market penetration and product development strategies are the appropriate strategies for this division.
Quadrant IV1. Concentric diversification2. Horizontal diversification3. Conglomerate diversification4. Joint ventures
Quadrant III1. Retrenchment2. Concentric diversification3. Horizontal diversification4. Conglomerate diversification5. Liquidation
Quadrant I1. Market development2. Market penetration3. Product development4. Forward integration5. Backward integration6. Horizontal integration7. Concentric diversification
Quadrant II1. Market development2. Market penetration3. Product development4. Horizontal integration5. Divestiture6. Liquidation
RAPID MARKET GROWTH
SLOW MARKET GROWTH
Grand Strategy Matrix
Recommended Strategy and Plan of action
Quantitative Strategic Planning Matrix Strategic AlternativesKey External Factors Weight Product development Market penetration
Economy 0.30 2 0.6 3 0.9
Political/Legal/Governmental 0.10 1 0.1 3 0.3
Environmental0.10 4 0.4 2 0.2
Technological 0.20 2 0.4 2 0.4
Competitive 0.30 2 0.6 2 0.6
Key Internal Factors
Management 0.20 2 0.4 3 0.6
Marketing 0.20 3 0.6 2 0.4
Finance/Accounting 0.10 2 0.2 4 0.4
Production/Operations 0.20 3 0.6 3 0.6
Research and Development 0.10 2 0.2 3 0.3
Computer Information Systems 0.20 2 0.4 3 0.6
Total: 1.00 4.5 5.3
Recommended Strategy and Plan of action
• Market Penetration– There have enough potential in the market
• The Wallace Group needs to increase the number of salespersons, increase advertising expenditures, offering extensive sales promotion items, or increase publicity efforts to capture more market shares.