The Best Strategy that Kraft Foods Group Might Implement - Coursework Example

Mod 4 Case Assign Kraft Food Executive Summary This assignment highlights the porter’s generic strategies that may prove effective in amplifying its customer base and profitability in the market. It also focuses on the strategic choices implemented by the organization in order to amplify its strengths and opportunities and improve its portfolio among others. Moreover, the ways in which, the strategic choices proved effective for the organization as compared to generic strategies is also focused in this paper. The paper will also discuss on the ways for which, the vision and mission of the organization changed for the making of certain strategic choices by the management in order to amplify its trust and loyalty in future era. Introduction Kraft Foods Group is considered as one of the reputed American grocery producer, headquartered within the region of Northfield of United States. The organization started its operations in the year 1903 and within a very few time span its enhanced its market share and position to a considerable extent as compared to many other rival players (Kraft Foods Group, 2014). The thesis statement of this assignment is to analyze and identify the best strategy that Kraft Foods Group might implement in order to amplify its strengths thereby reducing its weaknesses. The ways in which the selected strategy align with the generic strategy of the group of Kraft Foods that may prove effective for it in amplifying its competitiveness in the market among many other rival players. Moreover, the paper also highlights the ways in which the vision and mission of the organization changes on alignment of the selected strategy with its groups generic strategy. In order to accomplish the solutions to these above mentioned queries, porter’s generic strategy might be evaluated and the best one need to be selected for Kraft Foods Group. Then the selected strategy needs to be tallied with the internal strengths, weakness, opportunities and threats of the organization so as to analyze its effectiveness in future. The ways in which the selected strategy might amplify the productivity and profitability of the organization is also evaluated in this paper. The strategic choices taken by the organization so as to amplify its strengths and opportunities thereby reducing its threats and weaknesses are also focused in this assignment. The ways through which the strategic choices proved advantageous for the organization as compared to generic strategies, are also described in an effective way. Discussion Porter’s generic strategies Kraft Foods Group mainly aims to position itself as one of the reputed leader in the segment of food processing in the entire globe. In order to fulfill its vision, it tried to offer high quality of products at a competitive price. So that, the target customers of the organization might consume more and maintain a happy and delightful life in future age. Moreover, in order to attract a wide range of customers of varied income groups and age groups, it tried to offer highest attention over their preferences and likings (Blythe, 2006). The prime intension of doing so is to develop varied types of inventive product lines, as customer satisfaction is the prime essence of Kraft Foods Group. Thus, it might be clearly revealed that, Kraft Foods Group follows the strategy of differentiation and cost leadership (Armstrong & Kotler, 2005). According to this strategy, the organization might try to introduce varied types of healthy products such as ice cream, cheese, fluid milk, caramel candies, macaroni, margarines and many others at a quite competitive price. However, it became possible for the organization through various mergers and acquisitions with other companies such as Cadbury, National Dairy and many others. These strategies proved extremely effective for the organization to satisfy the changing preferences like healthy foods in a considerable extent. Thus, these strategies, not only amplified its customer base but profitability in the market as compared to many rival players. Selected strategy with aligned strategy of firm Kraft Foods Group desires to amplify its customer base and dominance in this competitive market. So, it tried to implement the strategy of product differentiation and cost leadership (Goldman & Nieuwenhuizen, 2006). But in order to offer a wide range of tasty and healthy product lines, Kraft Foods Group had to face numerous problems. The organization had to face problems at the time of launching of new products in this scenario of economic crisis, therefore, the organization decided to undertake the strategy of mergers and acquisitions. By implementing the procedure of mergers and acquisitions, Kraft Foods Group effectively reduced the weakness mentioned above. Moreover, by implementing such a strategic choice, the organization became successful in offering wide range of healthy products that satisfied their demands and requirements. Therefore the procedure of merger and acquisition implemented by Kraft Foods Group also amplified its total sales and demand of the products in international markets like China, Europe etc. This increased its opportunities to position itself as one of the leading brand offering quality products at an effective price. This strategic choice made by the organization reduced its threats of competitive rivalry with others like Nestle, ConAgra Foods etc. Kraft Foods Group also acquired Philip Morris in order to cope up with the increasing demand of beverages in numerous international markets. This strategic choice proved extremely effective for the organization that amplified its loyalty and consistency in the market to a considerable extent (Parnell, 2013). Hence, the debt of the organization declined and its total revenue enhanced consistency for such type of strategic choices. In order to satisfy the demand of the customers to consume custom made products, Kraft Foods Group decided to merger with general foods. It helped the organization to offer frozen food products to its customer at a quite competitive price. This strategy enabled Kraft Foods Group to amplify its customer base and reliability in the market as compared to its rival players like Nestle and ConAgra Foods. Therefore, it might be clearly revealed that the above mentioned generic strategy do not align with the strategic choices made by the organization. How Strategic choices leveraged the strengths By implementation of various strategic choices, Kraft Foods Group became successful in increasing its total revenue from US$17.28 billion in 2009 to US$18.22 billion in the year 2013. Therefore, the organization successfully cleared-off its debts and enhanced its total equity by US$ 5.187 billion in the year 2013 (Kraft Foods Group, 2013). Moreover, by implementing the strategic choice of merging and acquiring different organization of cheese, beverage and frozen foods, Kraft Foods Group became successful in positioning itself as the leading snacks and packaged product producer. The presence of such type of health and qualitative product lines, the organization became successful in expanding into numerous foreign markets like China, Europe etc. It fulfilled the requirements of packaged food products of the health conscious customers that enhanced their reliability and loyalty towards the brand. So, such types of strategic choices proved extremely worthy for Kraft Foods Group in this age of high bargaining power of the customers and competitiveness (Lake & Powell, 1999). The strategic choice of acquiring Cadbury also proved effective for Kraft Foods Group to increase its market share as compared to Nestle and ConAgra Foods. Acquisition of Philip Morris proved effective in satisfying the thirst of beverages of the customers and it improved the total sales of the organization. Thus, implementation of such strategies proved extremely effective in amplifying the demand and loyalty of the products of Kraft Foods Group among others (Leleur, 2012). Hence, implementation of strategic choices increased customer satisfaction rate that enhance its uniqueness and distinctiveness in this aggressive market among many other rival players (Kumar, 2009). Therefore, it might be depicted that the strategic choices enhanced the strengths and opportunities of Kraft Foods Group thereby declining threats and weaknesses significantly. Change of vision and mission by strategic analysis After analyzing and evaluating all the above mentioned points, it might be clearly depicted that the mission of Kraft Foods Group changed and it reveals that improvement in the total range of customer is the prime essence of the organization in this age (Ferrell & et. al. 2012). The vision of the organization is to penetrate into numerous new regions so as to become the leading producer in the segment of food processing as compared to others. In order to do so, the organization tried to implement the strategy of merger and acquisition. This helped the organization to cope up with the changing demands and taste of the customers that amplified their loyalty over the brand. However, enhancement of loyalty of the product lines of Kraft Foods Group proved effective for the organization to increase its total sales and prosperity in the market among other rivals such as Nestle and ConAgra Foods (Stonehouse & et. al. 2007). But Kraft Foods Group might desire to offer best quality of foods products to its customers at competitive price. So, it might try to offer more attention over the food standards in order to increase its dependency in the market. Moreover, it might try to offer low calorie ingredients within its products, then it might reduce the disorder of obesity. By reducing the disorder of obesity, the fascination of the individual towards the products of Kraft Foods Group might get increased. Improvement of the demand might increase the total sales and profitability of the organization that may amplify its brand image and market share as well. Thus, in order to amplify the reputation and distinctiveness of Kraft Foods Group, the organization might try to offer value-added products at an effective price. Then the organization might become successful in attracting and retaining a wide range of customers of varying profiles for long run as compared to others (Drummond & Ensor, 2006). Moreover, the decision to offer packaged products increased the trust of the health conscious consumers over the products of the brand that amplified its profitability and operating income. References Armstrong, G. & Kotler, P. (2005). Marketing: An Introduction. Germany: JohnWiley & Sons. Blythe, J. (2006). Principles & Practice of Marketing. London: Thomas Learning. Drummond, G. & Ensor, J. (2006). Introduction to Marketing Concepts. New York: Cengage Learning. Ferrell, C. O. & et. al. (2012). Marketing Principles. US: John Wiley & Sons. Goldman, G. & Nieuwenhuizen, C. (2006). Strategy: Sustaining Competitive Advantage in a Globalised Context. New York: Springer. Kumar, A. (2009). Marketing Management, 1E. London: Sage. Kraft Foods Group, (2014). Home. Retrieved from: http://www.kraftfoodsgroup.com/home/index.aspx Kraft Foods Group, (2013). Annual reports of Kraft Foods Group of 2013. Retrieved from: http://ir.kraftfoodsgroup.com/secfiling.cfm?filingID=1193125-13-118824& Leleur, S. (2012). Complex Strategic Choices: Applying Systemic Planning for Strategic Decision Making. New York: Springer. Lake, D. A. & Powell, R. (1999). Strategic Choice and International Relations. London: Sage. Parnell, J. A. 2013. Strategic Management: Theory and Practice. New York: Springer. Stonehouse, G. & et.al. (2007). Global and Transnational Business: Strategy and Management. London: Sage. Read More