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The Strategic Planning for Kudler Fine Food - Essay Example

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The paper "The Strategic Planning for Kudler Fine Food" highlights that the overall risk management strategy is to address risk through mitigation and retention. The organization will mitigate risks with defined actions where possible and accept the risk where mitigation is not a possibility. …
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Extract of sample "The Strategic Planning for Kudler Fine Food"

Running Head: The Strategic Plan for Kudler Fine Food The Strategic Plan for Kudler Fine Food: How Kudler Incorporate Strategic Thinking into Plan Student's Name Strategic Planning - STRTN/581 University of Phoenix Instructor's Name March 16, 2010 Objectives and Strategy Based on the KFF's mission, vision, and current situation, the company's short and mid-term objectives are to strengthen its current market positioning, reduce costs, and increase profits. These objectives will be achieved by launching a company wide Operational Excellence program that focuses on standardization, data centralization, supply chain automation and improved inventory management. In addition, KFF will increase its market presence and service offerings through innovation by implementing a web-based Catering service to its home and corporate consumers. The strategy will be executed in a phased approach and will initially focus on operational excellence. Once the company operations have been stream-lined and costs have been reduced, we will proceed with the implementation and launch of the web-based Catering service. To achieve operational excellence, the SAP Business ONE solution will be configured and deployed in the organization. This all in one solution will allow KFF to manage its accounting and financials, purchasing and operations, and most importantly better manage its supply chain and product inventory. To reduce up-front and maintenance cost, the company will use the SAP solution on a monthly subscription-based model. This eliminates the required up-front capital and transforms it in a monthly operational cost. The chosen service provider is Attenda as it offers a fully managed hosted SAP Business One solution at a competitive price with 24x7 customer support. WBS 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 The following section describes the action plan required for meeting the above stated objectives. This action plan implements the described strategy. Action Plan The following table lists the actions, milestones, and tasks required to implement the strategic plan. Tasks with a duration of zero (0) days are milestones. For a Gantt with WBS chart please refer to the Microsoft Project plan posted with this document. Table 1 Tasks and Milestones Task Duration Start Date End Date Phase 1 - Operational Excellence 55 days 22-Mar 7-June Define new purchasing and inventory management process 10 days 22-Mar 5-Apr Subscribe to SAP Business One - hosted 0 days 8-Apr 8- Apr Work with Provider to configure SAP solution 15 days 8- Apr 26- Apr Train Internal Employees on new Processes 10 days 8- Apr 19- Apr Train Senior Management on using SAP solution 5 days 22- Apr 26- Apr Work with suppliers to automate supply chain and procurement 15 days 29- Apr 16-May Launch new Processes and ERP Platform 0 days 19-May 19- May Monitor and Evaluate new platform 15 days 19- May 7-June Fine tune solution and processes as needed 15 days 19- May 7- June Phase 2 - Web Catering Service 160 days 24-May 31-Dec Competitive analysis 10 days 24-May 4-Jun identify web custom catering services competitors 5 days 24-May 28-May detailed analysis of services, pricing, and capabilities 5 days 31-May 4-Jun Project Scope Defined 0 days 4-Jun 4-Jun Define project requirements 20 days 7-Jun 2-Jul Hire development company 0 days 18-Jun 18-Jun Develop platform 45 days 23-Jul 24-Sep Signoff on UI design and system architecture 0 days 23-Jul 23-Jul Signoff project milestone 1 0 days 13-Aug 13-Aug Signoff project milestone 2 0 days 3-Sep 3-Sep Signoff project milestone 3 0 days 17-Sep 17-Sep Internal User Acceptance Testing 5 days 20-Sep 24-Sep Launch Catering Service 0 days 27-Sep 27-Sep Advertise new Catering service 70 days 27-Sep 31-Dec Key success factors To efficaciously implement the plan, the following are the key success factors that must be considered planning system, time, roadmap, environmental characteristics, strategic continuum, control, etc. With the proper planning system and road map, we can systematically implement project tasks in the right way with effective manner. Thus, it is concluded that at the time of plan implementation, the company should consider each and every aspect related to the strategic plan. Critical success factors can be defined in terms of human, technology and process in following tabular formats: Critical Success Factors Human Technology Process Top Management Support X Definition of KFF Strategy X X Competent Staff X Cross-department Integration X X Formation of inter-functional team X X IT structure management X Customer Service X X Customer information management X Customer Support Management X X Sales process automation X X Marketing process automation X X Support service for operational issue X X X Financial Plan Budget Table 2 Budgeted costs for implementing new strategy plan Item Budgeted Actual Cost SAP solution $50,000.00 $11,160.00* * $310 per month per license for 3 users for duration 1 year SAP training $10,000.00 Additional Salaries $190,000.00 Web Development $45,000.00 Catering service Advertising $150,000.00 TOTAL $445,000.00 Projected Revenues The operational excellence initiative is projected to reduce operational costs and costs of goods by 10%. In addition, the new Catering service is projected to increase company revenues by 5% in addition to current initiatives for revenue lift. Based on the latest total net revenues from the income statement ($10,796,200), revenue growth from the catering service alone would be roughly of 540,000$. Total revenue lift from the different plans being put in place is described in Table 3. Growth from all programs represents 17.25%. Table 3 Revenue Lift by program and quarter Cooking and Social Events Frequent Shopper Program Catering Service Q1 0.75% 0.25% 0.25% Q2 1.25% 0.50% 0.50% Q3 1.75% 1.75% 1.75% Q4 3.75% 2.25% 2.50% TOTAL 7.50% 4.75% 5.00% Resource Plan To successfully implement the new strategy, KFF will need to hire two new company officials, and outsource the SAP solution hosting and maintenance as well as the web catering platform development. Table 3 New employee requirements Position Classification Description Annualized Salary Director of Technology Officials & Managers Oversees the company's technology and IT infrastructure projects. Will be responsible to lead the SAP solution roll-out and manage the Web-based catering platform with outsourcing company. $95,000 Marketing Director Officials & Managers Defines, implements, and executes the company's Marketing and Advertising strategy. Responsible to advertise the new Catering service and improve brand awareness $95,000 In addition to hiring two new company officials, KFF will need to contract with two new providers. Table 4 New service provider requirements. Provider Description Cost Attenda SAP Business One hosted solution. Subscription based model and fully managed solution. $310 per license per month. $930 / month Development company TBD Outsourcing company responsible for the development of the new web-based catering service platform. Cost not yet defined. See budget. SAP SAP Training for company officials See budget. Risk Management Plan The overall risk management strategy is to address risk through mitigation and retention. The organization will mitigate risks with defined actions where possible and accept the risk where mitigation is not a possibility. Throughout execution of the herein defined strategic plan the management team will be responsible to monitor, identify, and assess potential impact of risks. The following is a list of potential risks and associated contingency actions. Potential Risk Expected Impact Contingency Delay in defining new purchasing and inventory management process Defining the new process is key to achieving operational excellence and launching the new SAP solution. This will delay the phase 1 and phase 2 project. - The team must bring in the right staff as needed to ensure the task is not delayed. - The process may be simplified if needed to come up with an initial solution that may be optimized later on Delay in integrating the SAP Business One hosted solution This is a low risk item as the delay should be minimal. This is a fully managed hosted service and has few complexities. If the process is well defined and the team precisely communicates the desired configuration then this should be low impact. Work with service provider to expedite the integration. Inability to integrate suppliers in automated supply chain High risk impact. One of the main objectives with using an advance ERP solution is to benefit from the automated supply chain management features. Failure to do so will reduce cost savings and return on investment. - The team should identify other potential suppliers ahead of time. If it comes to worse the team should look at changing supplier as last resort. - Hire SAP consultants to assist in the supply chain integration and automation setup Delay in web platform development Depending on the delay, this may have severe impact on the overall project. The objective is to launch and advertise the web service before the Thanks Giving week-end. - The project plan is based on 4 milestones which provides more control and less risk on timelines. - The team should look at temporarily removing features that do not reduce the value of the service to allow launching according to plan. Web development cost higher than initially budgeted The contract with the development company will be clearly defined with milestones defined, requirements signed, and cost fully established. This should be minimal risk with low impact. - Change requests should be negotiated with the supplier if needed. - Additional cost should be incurred if added cost doesn't significantly reduce expected ROI. Process Constant monitoring of the above defined risks should be done for the duration of the project by the appointed manager. New identified risks will be documented including the description of the risk, risk impact assessment, and should be escalated to ensure immediate and appropriate action. A cost and benefit analysis should be done prior to deciding to mitigate or accept the risk. The following data format will be used for the monitoring and tracking of risk items. Risk Description Severity Probability Impact Required Action Action Owner Reference: Portny, S.E. (2006). Project management for dummies. (2nd ed.). For Dummies. Ryall, M. J. & Craig, J. C. (2003). Strategic Management Kogan Page Publishers. Shim, J. K. & Siegel, J. G. (2000). Financial Management (2nd ed.). Barron's Educational Series. Wilson, R. M. S. & Gilligan, C. (2005). Strategic Marketing Management: Planning, Implementation and Control (3rd ed.). Butterworth-Heinemann. John A. Pearce & Richard B. Robinson (2009) - Strategic Management, 11th edition. Retrieved March 16, 2010 from the University of Phoenix Website. Read More
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