Strategic Performance of Mitchell & Butler - Essay Example

Task: An articular about the strategic performance of Mitchell & Butler Outline Business bit a. A brief introduction on the Mitchells and Butlers Company and a concise history 2. Corporate strategy 3. Business strategy 4. Conclusion 5. Bibliography Introduction What makes Mitchells and Butlers Company tick in the modern world where people are trying to save on time whenever possible? The answer lies in how the company has managed to integrate its businesses to have them at the same place, but different venues to ensure that customers have any services in the hospitality industry at their disposal. So what makes this possible in a world where luxury is about taking pleasure in life in the best of the hospitality facilities in the world? It lays in the corporations operations that are divided into two business divisions namely “Pubs and bars” and “Restaurants”. Mitchells and Butlers Company owns and operates a considerable number of pubs, bars and restaurants, and this is, in addition to a number of, hotels that are located in the same place, but different venues with the pubs and restaurants. What has been done to tap into the worlds market and better their services for competitive advantage? The business divisions operate under different brands such as Sizzlin pub Co and Vintage inns. These are just two out of the available twenty four, and are as a result of the company’s first merger of midlands family businesses to form Mitchells and Butlers back in 1898. This was just the start of mergers the company would be involved in, and this was experienced in 1961 and 2010 after the purchase of HaHa Bar and Grill businesses, and this gives way to All Bar One and Brown Brands. Now who said that organizations should cut on costs by utilizing the available resources to achieve the best? This is certainly Mitchell and Butler’s management which has affected team work. The company has divided its employees into teams that have assigned roles to each member, for their conclusive participation to achieve the desired success. What makes the company different? This group has decided to break the monotony of world’s pubs, bars, restaurants and hotels to run food led pubs and restaurants instead of the common, traditional drinks led hospitality businesses. Food has now replaced drinks in terms of percentage of sales increasing from 31% five years ago to 47%. The business strategy of the company was born out of the January 2012; Board members’ review that was conducted on the business with a view of modernizing and developing the company into a favorite in the food enterprise business. The review outlined the developments that came up in the last 55days after evaluating the organization. The business entity was a strong, financially sound with solvable setbacks backed with a vast reserve of assets, brands and an efficient management team. This came in line with the significant expansion in the total figure of brands produced by the company and abundant opportunities aimed at downsizing the portfolio of the brands, reduction of expenses, recovering the margins and managing incentives. The company vision was to be used as a typical extent of food and beverages in the foodstuff industry. An interview with the company’s executive chairman Mr. Bob Ivell revealed that the company has its eyes set on success by ensuring that their business attract and retain customers. The company wants to utilize the fresh and quality products which in turn dictate the prices. The business entity base its tactics on a recent research that outlined that food records 42billion dollars of the total 71 billion for food together with beverage in the market. This is to maintain competitive advantage over their competitors. Introduction of Landmark Beer guidelines in the year 1989 altered everything, save for rapid evolution of innovative brands similar to brands like Browns, O’Neill and bars, taking into account the economic situation at that time. It is noteworthy that the company had got a share in both beneficial and ineffectual. This is following its business decisions especially when drinks formed the larger proportion of sales as compared to drinks. Business strategy entails the capital and capabilities existing within a business. Therefore, once resources are identified the probability of economizing their usage or using the company’s possessions intensifies. Once employees of a company work together to obtain satisfactory results, then this is termed as the company capabilities. Therefore, when teams of company resources work together to achieve results, this translates into the firm’s capabilities. This is because an organization’s policy is reliant on the growth of their abilities or strengths, in order to shape the basis for their competitive benefit. It is vital for an organization to comprehend its strengths and limitations, opportunities and challenges in an organization. This means that the strength of the entity is the capability to produce known brands and existing operating capability of teams relations with the supplier’s and guest’s devotion, for the business experience cost returns over its rivals as the economies levels forces the company to cut down the costs of its operation. It is notable that an analysis is an essential aspect in a company, for it provides a preview for deliberation on many factors that contribute to beneficial and cynical influences that categorize and review the main influences on an organization. This is, in addition to, its role in probing the market environment and the upcoming environment experienced by most businesses, in the corporate world. Thus, why companies with better plans than their rivals by understanding and make the most out of the business world are certain of a sustainable competitive advantage. However, the company has had its misgivings, and the company’s manager explains the recent one as the unrealistic rise in taxes from 17.5 percent to 20% in 2009. This left the company with two options to settle on as to increase and compensate on the profits made or increasing the prices of their products, and this discriminated against those guests who were price conscious. Subsequently, this compromised the valued brands and put their product volume at risk. It is no wonder that the stakeholders in the company sat down in 2010 to forge ahead by resolving to shift from the traditional business that traded mainly on drinks, to expanding sales on food. This corporate strategy has worked to the company’s current success. This is because of its uniqueness in trade that has seen customer shifts to their side. However, there are some setbacks that are a threat to this success, and this includes the 2010 governments impermanent cap on non EU immigrants entitled to visit UK. This is an issue given that a considerable number of employees in the hospitality sector are from overseas. Analyzing the food and beverage industry, the above issues tremendously affect the success of the company. This is because it threatens profitability, competition from new business entrants, and accessibility of substitutes and concentration of rivalry. However, the major threat to productivity is the accessibility of substitutes. This is because the restaurant industry is mostly affected by this as a result of different needs and varied offers of the guests, and this reduces the switching costs between the operators and guests, especially when there is moderately similar cost of available substitutes. New entrants in the market continue to act as a threat to the company profit gains too. This is due to challenges of gaining entry in the market together with intense competition among its competitors. This has forced the company to re examine their composition and brands in line with Mitchells & Butlers approach to pull out from the lower price, drinks-led advertisement and the tardy night -street bars as stated in March 2010. This condition has resulted to disposal of a number of minor plans to invest the profits into development initiative available in an informal dining out market. The policy to expand the six leading brands which centers on the mounting dining out habits has begun as numerous outlets are now branded. Consequently, new outlets are being used to adapt to accessible brands in expanding their market outside the current estate. Plans to expand brands like Harvester into some retail parks are the new plan for the firm. The finance director Mr. Tim Jones acknowledged this strategy and added that it has made Mitchells and Butlers Company an exceptional company. This is in how it has set a precedence of maximized profits just by changing its corporate strategy that has been created through deviation from the norm. This maintenance of guests has helped to preserve the loyalty of the guests and bringing new visitors into the trade. Its strength lies in mergers and acquisitions that form some of the recent developments that have catapulted the company to greater heights of achievement. Therefore, judging by these mergers, the company has always assumed the position of a bidder, a situation that works to its advantage. This means that it has a higher commanding of interests, and that it has a stable supply of customers who trust its products. This has subsequently resulted in a competitive advantage over the other companies. This will in turn encourage a high level of competence and hence the company will dictate its own growth. A weakness in a company implies its capability to enlist an efficient team, and an invariable shortage of a superior team specifically in the retail team is a challenge. The crisis is particularly rife in the number of chefs plus kitchen teams and is apparent in the number of vacancies existing in the employment website. Retail pay organization is not aggressive hence it finds it impossible to draw a credible caliber team. This challenge will be dealt with as the business attempts to implement quick growth policy, and experience in employment of a quality team to manage this of which Mitchells and Butlers Company is capable given its resolution. List of references Baum, J. A., & Dobbin, F. (2000), Economics meets sociology in strategic management. London, Emerald. Blount, Y., Castleman, T., & Swatman, P. M. (2002), Ecommerce and human resource management theoretical approaches and issues for the banking industry, the New York, Deakin University School of Information Systems. Choo, C. W., & Bontis, N. (2002), The strategic management of intellectual capital and organizational knowledge, New York: Oxford University Press. Cohen, W. A. (2004). The art of the strategist 10 essential principles for leading your company to victory, New York, AMACOM. Fottler, M. D., Khatri, N., & Savage, G. T. (2010), Strategic human resource management in health care, London, Emerald. Grove, A. S. (2009), Only the paranoid survive, how to exploit the crisis points that challenge every company and career, New York: Currency Doubleday. Jayachandran, C. (2010), Business clusters: partnering for strategic advantage, London, Routledge. Mitchells and Buttlers (a). 2003. Our Brands. Retrieved on 2nd may 2012from < http://www.mbplc.com/ourbrands/ > Mitchells and Butler (b). 2012. Company overview. Retrieved on 2nd May 2012 from < http://www.mbplc.com/aboutus/companyoverview/ > Mitchells and Butlers (c). 2012. Our History. Retrieved on 2nd May 2012 from < http://www.mbplc.com/aboutus/ourhistory/ > Mitchell, B., & Gamlem, C. (2012). The big book of HR. London, Career Press. Reuer, J. J. (2004) Strategic alliances: theory and evidence, New York, Oxford University Press. Shrivastava, P., Huff, A. S., & Dutton, J. E. (2005), Advances in strategic management, a research annual. London, JAI Press. Whittaker, J. B. (2009), Strategic planning in a rapidly changing environment, London, Lexington Books. Read More