problem1) What is Gap Analysis. Describe how Gap Analysis could be helpful in formulating a firm’s strategy.
problem2) What do you understand by the concept of Benchmarking. Describe how Benchmarking could be effectively utilized in evaluate a firms Strengths and Weakness.
problem3) How in your view policies aid strategy implementation? Demonstrate your answer with suitable exs from corporate world.
problem4) Select at least ten vision and mission statements of different companies. Choose at least two companies each from manufacturing and service sector.
The name Campbell Soup is closely linked with its well-known soups, and for many years they have been a source of the company’s profitability. Though, during 1980’s company’s fortunes declined as its top executives failed to manage business and keep it abreast of changes in the environment. Whereas competitors such as Heinz and Nestle were innovating products and introducing new cost saving machinery Campbell was content to do business the way it had always done, although its costs were rising and its sales were stagnant. This state of affairs changed in 1990 when David W. Johnson arrived from Gerber Products to revitalize the company.
Johnson moved immediately to reduce costs and to increase profits. He closed twenty ineffective plants, including Campbell’s famous multi-storey Camden, New Jersey, factory where it had made soup in the traditional way in larger copper pans. All these actions were part of his turnaround strategy to move Campbell back to a hold-and-maintain position in food industry in order to redeploy its resources so that it can compete for market share against its more efficient rivals. His actions were successful, and the company’s stock price doubled in one year as profits rebounded.
Though analysts have applauded his efforts, they became concerned that Johnson may be pursuing his cost-cutting strategy a little too vigorously and at his expense of new-product development. Generally a hold-and-maintain strategy includes investing resources in developing new products which build and maintain market share. Though, Johnson killed many of company’s new product lines as they were unprofitable and seemed reluctant to invest much in new product development. It soon became clear that pause in product development was just to give Johnson and his top management team time to study the situation carefully. By 1996 Campbell was making record profits and was once again in a very strong situation after having brought out a large number of successful new products.
problem1) describe the reasons for dwindling fortunes of the company during 1980’s
problem2) What strategies did Johnson pursue to turnaround company?
problem3) When do you think it is appropriate to pursue hold-and-maintain strategy?