When Imperatives Collide The 2003 San Diego Firestorm Case Study Help

Case Study Solution And Analysis

Home >> Chicago Booth >> When Imperatives Collide The 2003 San Diego Firestorm >>

When Imperatives Collide The 2003 San Diego Firestorm Case Study Solution

Business is presently one of the greatest food chains worldwide. It was founded by Henri When Imperatives Collide The 2003 San Diego Firestorm in 1866, a German Pharmacist who first introduced "FarineLactee"; a combination of flour and milk to feed infants and decrease death rate.
Business is now a multinational company. Unlike other international companies, it has senior executives from different countries and attempts to make decisions thinking about the whole world. When Imperatives Collide The 2003 San Diego Firestorm currently has more than 500 factories around the world and a network spread across 86 nations.


The purpose of Business Corporation is to improve the quality of life of people by playing its part and offering healthy food. While making sure that the business is succeeding in the long run, that's how it plays its part for a better and healthy future


When Imperatives Collide The 2003 San Diego Firestorm's vision is to provide its consumers with food that is healthy, high in quality and safe to eat. Business visualizes to develop a well-trained workforce which would help the company to grow


When Imperatives Collide The 2003 San Diego Firestorm's mission is that as currently, it is the leading business in the food market, it believes in 'Good Food, Good Life". Its objective is to provide its consumers with a range of options that are healthy and best in taste. It is focused on supplying the very best food to its consumers throughout the day and night.


Business has a large range of items that it provides to its consumers. Its products include food for infants, cereals, dairy items, treats, chocolates, food for family pet and bottled water. It has around 4 hundred and fifty (450) factories all over the world and around 328,000 employees. In 2011, Business was listed as the most rewarding organization.

Goals and Objectives

• Keeping in mind the vision and objective of the corporation, the company has put down its goals and objectives. These objectives and objectives are listed below.
• One goal of the business is to reach absolutely no garbage dump status. (Business, aboutus, 2017).
• Another goal of When Imperatives Collide The 2003 San Diego Firestorm is to waste minimum food during production. Usually, the food produced is wasted even prior to it reaches the consumers.
• Another thing that Business is dealing with is to improve its packaging in such a way that it would help it to decrease those problems and would also guarantee the shipment of high quality of its products to its customers.
• Meet global requirements of the environment.
• Build a relationship based upon trust with its customers, company partners, staff members, and federal government.

Critical Issues

Recently, Business Business is focusing more towards the technique of NHW and investing more of its earnings on the R&D technology. The country is investing more on acquisitions and mergers to support its NHW technique. The target of the business is not accomplished as the sales were expected to grow higher at the rate of 10% per year and the operating margins to increase by 20%, provided in Exhibition H. There is a requirement to focus more on the sales then the innovation technology. Otherwise, it may result in the decreased revenue rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The existing Business strategy is based on the principle of Nutritious, Health and Wellness (NHW). This strategy deals with the concept to bringing modification in the client preferences about food and making the food things much healthier concerning about the health issues.
The vision of this method is based on the key technique i.e. 60/40+ which just means that the products will have a score of 60% on the basis of taste and 40% is based on its dietary value. The items will be made with extra nutritional value in contrast to all other items in market acquiring it a plus on its nutritional content.
This technique was embraced to bring more delicious plus nutritious foods and drinks in market than ever. In competitors with other companies, with an intention of maintaining its trust over consumers as Business Business has gained more trusted by costumers.

Quantitative Analysis.

R&D Spending as a portion of sales are decreasing with increasing real amount of costs reveals that the sales are increasing at a higher rate than its R&D costs, and permit the company to more spend on R&D.
Net Profit Margin is increasing while R&D as a portion of sales is declining. This sign likewise reveals a thumbs-up to the R&D spending, mergers and acquisitions.
Financial obligation ratio of the company is increasing due to its spending on mergers, acquisitions and R&D advancement rather than payment of financial obligations. This increasing financial obligation ratio present a threat of default of Business to its financiers and might lead a decreasing share rates. In terms of increasing debt ratio, the company must not invest much on R&D and needs to pay its existing financial obligations to decrease the danger for financiers.
The increasing threat of investors with increasing financial obligation ratio and declining share costs can be observed by substantial decline of EPS of When Imperatives Collide The 2003 San Diego Firestorm stocks.
The sales growth of business is also low as compare to its mergers and acquisitions due to slow perception building of customers. This slow growth likewise impede business to further invest in its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of computations and Graphs given up the Displays D and E.

TWOS Analysis

TWOS analysis can be utilized to obtain different methods based on the SWOT Analysis provided above. A quick summary of TWOS Analysis is given up Exhibition H.

Strategies to exploit Opportunities using Strengths

Business must introduce more innovative items by large quantity of R&D Spending and mergers and acquisitions. It could increase the market share of Business and increase the profit margins for the company. It might also provide Business a long term competitive advantage over its rivals.
The worldwide growth of Business must be focused on market capturing of establishing nations by growth, bring in more clients through client's loyalty. As establishing nations are more populated than developed nations, it could increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisWhen Imperatives Collide The 2003 San Diego Firestorm should do mindful acquisition and merger of organizations, as it could affect the client's and society's understandings about Business. It should obtain and combine with those business which have a market reputation of healthy and healthy companies. It would improve the understandings of consumers about Business.
Business ought to not only spend its R&D on innovation, rather than it ought to also focus on the R&D costs over assessment of cost of numerous healthy items. This would increase expense efficiency of its items, which will result in increasing its sales, due to decreasing rates, and margins.

Strategies to use strengths to overcome threats

Business must move to not only establishing but also to developed nations. It ought to expands its geographical growth. This wide geographical expansion towards establishing and developed nations would minimize the threat of possible losses in times of instability in different nations. It must widen its circle to numerous countries like Unilever which operates in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

When Imperatives Collide The 2003 San Diego Firestorm should sensibly manage its acquisitions to prevent the risk of misconception from the consumers about Business. It needs to get and merge with those countries having a goodwill of being a healthy company in the market. This would not just enhance the perception of customers about Business however would also increase the sales, revenue margins and market share of Business. It would also enable the business to utilize its prospective resources effectively on its other operations instead of acquisitions of those organizations slowing the NHW strategy growth.

Segmentation Analysis

Demographic Segmentation

The market segmentation of Business is based on four aspects; age, gender, income and occupation. For example, Business produces numerous products related to children i.e. Cerelac, Nido, and so on and associated to grownups i.e. confectionary items. When Imperatives Collide The 2003 San Diego Firestorm products are rather budget friendly by nearly all levels, however its significant targeted clients, in regards to income level are middle and upper middle level consumers.

Geographical Segmentation

Geographical division of Business is composed of its presence in nearly 86 countries. Its geographical segmentation is based upon 2 primary factors i.e. average income level of the customer in addition to the climate of the region. For instance, Singapore Business Business's segmentation is done on the basis of the weather condition of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic segmentation of Business is based upon the character and life style of the customer. For instance, Business 3 in 1 Coffee target those consumers whose life style is quite hectic and don't have much time.

Behavioral Segmentation

When Imperatives Collide The 2003 San Diego Firestorm behavioral segmentation is based upon the attitude knowledge and awareness of the consumer. For example its extremely nutritious items target those clients who have a health mindful attitude towards their consumptions.

When Imperatives Collide The 2003 San Diego Firestorm Alternatives

In order to sustain the brand in the market and keep the client undamaged with the brand, there are two choices:
Option: 1
The Company must invest more on acquisitions than on the R&D.
1. Acquisitions would increase overall properties of the business, increasing the wealth of the business. Costs on R&D would be sunk cost.
2. The company can resell the obtained systems in the market, if it fails to execute its strategy. Quantity spend on the R&D could not be restored, and it will be considered totally sunk cost, if it do not offer prospective outcomes.
3. Spending on R&D offer sluggish growth in sales, as it takes long time to introduce an item. Acquisitions offer quick results, as it supply the company already developed item, which can be marketed soon after the acquisition.
1. Acquisition of company's which do not fit with the company's values like Kraftz foods can lead the company to deal with mistaken belief of customers about Business core worths of healthy and healthy items.
2 Big spending on acquisitions than R&D would send out a signal of company's ineffectiveness of establishing ingenious items, and would results in customer's discontentment as well.
3. Big acquisitions than R&D would extend the product line of the company by the items which are currently present in the market, making business not able to present new ingenious products.
Option: 2.
The Business should spend more on its R&D instead of acquisitions.
1. It would make it possible for the company to produce more ingenious items.
2. It would provide the company a strong competitive position in the market.
3. It would enable the company to increase its targeted clients by introducing those items which can be used to an entirely brand-new market section.
4. Innovative items will offer long term advantages and high market share in long run.
1. It would reduce the earnings margins of the business.
2. In case of failure, the whole costs on R&D would be considered as sunk expense, and would impact the business at large. The threat is not when it comes to acquisitions.
3. It would not increase the wealth of company, which might offer an unfavorable signal to the financiers, and could result I decreasing stock costs.
Alternative 3:
Continue its acquisitions and mergers with considerable costs on in R&D Program.
Vrio AnalysisPros:
1. It would allow the company to present new innovative products with less danger of converting the costs on R&D into sunk expense.
2. It would offer a positive signal to the investors, as the overall properties of the business would increase with its considerable R&D spending.
3. It would not impact the earnings margins of the business at a large rate as compare to alternative 2.
4. It would supply the business a strong long term market position in regards to the business's overall wealth as well as in regards to innovative items.
1. Threat of conversion of R&D spending into sunk cost, higher than option 1 lower than alternative 2.
2. Risk of misconception about the acquisitions, higher than alternative 2 and lesser than alternative 1.
3. Intro of less variety of ingenious items than alternative 2 and high number of innovative products than alternative 1.

When Imperatives Collide The 2003 San Diego Firestorm Conclusion

RecommendationsBusiness has actually stayed the top market player for more than a decade. It has actually institutionalized its methods and culture to align itself with the marketplace changes and customer behavior, which has actually ultimately enabled it to sustain its market share. Though, Business has actually developed significant market share and brand name identity in the urban markets, it is advised that the business should concentrate on the rural areas in regards to developing brand name loyalty, awareness, and equity, such can be done by creating a specific brand name allocation method through trade marketing tactics, that draw clear difference in between When Imperatives Collide The 2003 San Diego Firestorm products and other competitor items. When Imperatives Collide The 2003 San Diego Firestorm ought to leverage its brand image of safe and healthy food in catering the rural markets and likewise to upscale the offerings in other classifications such as nutrition. This will allow the business to develop brand name equity for newly introduced and already produced items on a greater platform, making the effective use of resources and brand name image in the market.

When Imperatives Collide The 2003 San Diego Firestorm Exhibits

PESTEL Analysis
Governmental support

Transforming requirements of worldwide food.
Boosted market share. Changing assumption towards healthier products Improvements in R&D as well as QA divisions.

Introduction of E-marketing.
No such influence as it is beneficial. Issues over recycling.

Use sources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest possible since 2000 Greatest after Service with less growth than Service 5th Cheapest
R&D Spending Highest possible considering that 2006 Highest after Company 8th Cheapest
Net Profit Margin Greatest since 2007 with rapid development from 2001 to 2019 Due to sale of Alcon in 2016. Practically equal to Kraft Foods Consolidation Nearly equal to Unilever N/A
Competitive Advantage Food with Nutrition as well as health variable Highest possible number of brand names with lasting methods Largest confectionary and processed foods brand name worldwide Biggest dairy items and bottled water brand on the planet
Segmentation Middle and upper center level customers worldwide Private customers in addition to household group All age and also Earnings Client Groups Center and upper middle degree customers worldwide
Number of Brands 4th 6th 4th 2nd

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 73522 668369 992283 464156 498594
Net Profit Margin 4.91% 3.13% 84.37% 8.73% 43.45%
EPS (Earning Per Share) 84.52 4.66 2.74 4.75 79.23
Total Asset 561756 543526 653185 888596 41384
Total Debt 67867 84666 58759 24349 15447
Debt Ratio 76% 44% 35% 68% 99%
R&D Spending 5743 3833 6323 5148 8721
R&D Spending as % of Sales 8.52% 7.25% 2.71% 8.36% 5.95%

Executive Summary Swot Analysis Vrio Analysis Pestel Analysis
Porters Analysis Recommendations