Menu

Automated Intelligence Corp Case Study Solution

Case Study Solution And Analysis


Home >> Darden >> Automated Intelligence Corp >>

Automated Intelligence Corp Case Study Analysis

Business is presently one of the most significant food chains worldwide. It was founded by Henri Automated Intelligence Corp in 1866, a German Pharmacist who initially released "FarineLactee"; a combination of flour and milk to feed babies and decrease mortality rate.
Business is now a multinational business. Unlike other multinational business, it has senior executives from various countries and attempts to make decisions thinking about the whole world. Automated Intelligence Corp presently has more than 500 factories worldwide and a network spread throughout 86 nations.

Purpose

The purpose of Automated Intelligence Corp Corporation is to boost the quality of life of people by playing its part and supplying healthy food. It wishes to help the world in shaping a healthy and much better future for it. It likewise wishes to motivate individuals to live a healthy life. While making certain that the company is prospering in the long run, that's how it plays its part for a better and healthy future

Vision

Automated Intelligence Corp's vision is to provide its customers with food that is healthy, high in quality and safe to consume. It wants to be innovative and simultaneously comprehend the needs and requirements of its customers. Its vision is to grow fast and supply items that would please the requirements of each age group. Automated Intelligence Corp visualizes to develop a trained labor force which would help the business to grow
.

Mission

Automated Intelligence Corp's mission is that as currently, it is the leading company in the food industry, it thinks in 'Excellent Food, Great Life". Its mission is to provide its consumers with a range of choices that are healthy and finest in taste. It is concentrated on supplying the best food to its customers throughout the day and night.

Products.

Automated Intelligence Corp has a large variety of items that it offers to its customers. In 2011, Business was noted as the most gainful company.

Goals and Objectives

• Remembering the vision and objective of the corporation, the business has laid down its goals and goals. These objectives and objectives are listed below.
• One goal of the company is to reach absolutely no landfill status. (Business, aboutus, 2017).
• Another objective of Automated Intelligence Corp is to lose minimum food throughout production. Most often, the food produced is squandered 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 minimize the above-mentioned issues and would also guarantee the delivery of high quality of its products to its consumers.
• Meet global standards of the environment.
• Build a relationship based upon trust with its consumers, company partners, staff members, and federal government.

Critical Issues

Recently, Business Company is focusing more towards the strategy of NHW and investing more of its revenues on the R&D technology. The nation is investing more on acquisitions and mergers to support its NHW method. The target of the company 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%, given in Exhibition H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The present Business strategy is based upon the principle of Nutritious, Health and Wellness (NHW). This method deals with the concept to bringing modification in the client preferences about food and making the food stuff healthier worrying about the health concerns.
The vision of this strategy is based upon the key approach i.e. 60/40+ which merely means that the items will have a rating of 60% on the basis of taste and 40% is based on its dietary worth. The items will be made with extra dietary worth in contrast to all other items in market getting it a plus on its nutritional content.
This method was embraced to bring more yummy plus healthy foods and drinks in market than ever. In competitors with other business, with an objective of retaining its trust over customers as Business Business has gained more trusted by clients.

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 greater rate than its R&D spending, and enable the business to more invest in R&D.
Net Earnings Margin is increasing while R&D as a portion of sales is decreasing. This indicator likewise reveals a thumbs-up to the R&D costs, mergers and acquisitions.
Financial obligation ratio of the company is increasing due to its spending on mergers, acquisitions and R&D development instead of payment of financial obligations. This increasing debt ratio pose a danger of default of Business to its investors and might lead a declining share prices. For that reason, in regards to increasing debt ratio, the firm ought to not invest much on R&D and should pay its existing financial obligations to reduce the threat for investors.
The increasing threat of investors with increasing financial obligation ratio and decreasing share prices can be observed by substantial decrease of EPS of Automated Intelligence Corp stocks.
The sales growth of business is likewise low as compare to its mergers and acquisitions due to slow understanding structure of customers. This slow growth likewise hinder business to additional spend on its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Note: All the above analysis is done on the basis of calculations and Charts given in the Displays D and E.

TWOS Analysis


2 analysis can be utilized to obtain different techniques based on the SWOT Analysis given above. A brief summary of TWOS Analysis is given up Display H.

Strategies to exploit Opportunities using Strengths

Business must introduce more innovative items by big quantity of R&D Costs and mergers and acquisitions. It could increase the market share of Business and increase the revenue margins for the business. It might also provide Business a long term competitive benefit over its competitors.
The global growth of Business must be concentrated on market capturing of establishing countries by growth, drawing in more clients through customer's loyalty. As establishing countries are more populous than industrialized nations, it could increase the consumer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisAutomated Intelligence Corp needs to do careful acquisition and merger of organizations, as it might impact the consumer's and society's perceptions about Business. It should acquire and combine with those companies which have a market credibility of healthy and healthy business. It would improve the perceptions of customers about Business.
Business must not just invest its R&D on development, instead of it must likewise focus on the R&D costs over evaluation of expense of different nutritious products. This would increase cost effectiveness of its items, which will lead to increasing its sales, due to declining prices, and margins.

Strategies to use strengths to overcome threats

Business should move to not just establishing but also to industrialized nations. It needs to expand its circle to numerous countries like Unilever which runs in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

It ought to obtain and merge with those countries having a goodwill of being a healthy business in the market. It would also allow the business to use its prospective resources effectively on its other operations rather than acquisitions of those companies slowing the NHW method development.

Segmentation Analysis

Demographic Segmentation

The market division of Business is based on 4 factors; age, gender, earnings and profession. For instance, Business produces numerous items connected to babies i.e. Cerelac, Nido, etc. and related to adults i.e. confectionary products. Automated Intelligence Corp items are quite budget-friendly by almost all levels, however its major targeted customers, in regards to earnings level are middle and upper middle level consumers.

Geographical Segmentation

Geographical segmentation of Business is composed of its existence in almost 86 countries. Its geographical segmentation is based upon two primary factors i.e. typical earnings level of the consumer as well as the environment of the region. 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 lifestyle of the client. Business 3 in 1 Coffee target those consumers whose life style is rather hectic and don't have much time.

Behavioral Segmentation

Automated Intelligence Corp behavioral division is based upon the attitude knowledge and awareness of the consumer. Its extremely nutritious items target those consumers who have a health conscious attitude towards their usages.

Automated Intelligence Corp Alternatives

In order to sustain the brand name in the market and keep the consumer undamaged with the brand name, there are two choices:
Option: 1
The Business ought to spend more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall assets of the business, increasing the wealth of the company. Nevertheless, costs on R&D would be sunk expense.
2. The company can resell the acquired units in the market, if it fails to implement its technique. Quantity invest on the R&D could not be revived, and it will be considered entirely sunk expense, if it do not provide prospective outcomes.
3. Spending on R&D offer sluggish development in sales, as it takes very long time to present a product. Nevertheless, acquisitions offer fast results, as it offer the business already established item, which can be marketed not long after the acquisition.
Cons:
1. Acquisition of company's which do not fit with the company's worths like Kraftz foods can lead the business to face mistaken belief of consumers about Business core worths of healthy and nutritious items.
2 Large spending on acquisitions than R&D would send out a signal of company's inefficiency of developing ingenious items, and would lead to customer's dissatisfaction also.
3. Large acquisitions than R&D would extend the product line of the company by the products which are currently present in the market, making company not able to introduce brand-new ingenious items.
Option: 2.
The Business ought to invest more on its R&D rather than acquisitions.
Pros:
1. It would enable the company to produce more innovative items.
2. It would provide the business a strong competitive position in the market.
3. It would allow the company to increase its targeted consumers by introducing those products which can be provided to a totally brand-new market section.
4. Innovative items will supply long term advantages and high market share in long term.
Cons:
1. It would decrease the earnings margins of the company.
2. In case of failure, the entire costs on R&D would be considered as sunk expense, and would affect the business at big. The risk is not when it comes to acquisitions.
3. It would not increase the wealth of business, which might offer an unfavorable signal to the investors, and might result I declining stock prices.
Alternative 3:
Continue its acquisitions and mergers with significant spending on in R&D Program.
Vrio AnalysisPros:
1. It would enable the business to present brand-new innovative items with less risk of converting the costs on R&D into sunk cost.
2. It would supply a favorable signal to the financiers, as the general properties of the business would increase with its substantial R&D costs.
3. It would not impact the earnings margins of the business at a big rate as compare to alternative 2.
4. It would offer the company a strong long term market position in terms of the business's general wealth in addition to in terms of ingenious items.
Cons:
1. Risk of conversion of R&D costs into sunk cost, higher than alternative 1 lesser than alternative 2.
2. Risk of mistaken belief about the acquisitions, greater than alternative 2 and lesser than alternative 1.
3. Intro of less number of innovative products than alternative 2 and high variety of innovative items than alternative 1.

Automated Intelligence Corp Conclusion

RecommendationsIt has actually institutionalized its techniques and culture to align itself with the market modifications and customer behavior, which has ultimately enabled it to sustain its market share. Business has established considerable market share and brand name identity in the city markets, it is advised that the company must focus on the rural locations in terms of establishing brand name commitment, awareness, and equity, such can be done by creating a specific brand name allotment method through trade marketing methods, that draw clear difference between Automated Intelligence Corp items and other competitor products.

Automated Intelligence Corp Exhibits

PESTEL Analysis
P
Political
E
Economic
S
Social
T
Technology
L
Legal
E
Environment
Governmental support

Altering requirements of global food.
Boosted market share.
Transforming assumption towards healthier items
Improvements in R&D and QA divisions.

Introduction of E-marketing.
No such effect as it is good.
Concerns over recycling.

Use of resources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Greatest given that 6000
Highest after Organisation with much less development than Company 9th Cheapest
R&D Spending Greatest since 2006 Highest possible after Business 5th Most affordable
Net Profit Margin Highest since 2003 with rapid growth from 2006 to 2017 Because of sale of Alcon in 2013. Nearly equal to Kraft Foods Incorporation Virtually equal to Unilever N/A
Competitive Advantage Food with Nutrition and also health and wellness variable Highest possible number of brands with lasting techniques Biggest confectionary and refined foods brand name on the planet Biggest milk items as well as mineral water brand name in the world
Segmentation Center as well as upper center level customers worldwide Private consumers together with household team All age and Revenue Customer Groups Middle and top middle degree customers worldwide
Number of Brands 7th 4th 6th 5th

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 84185 636553 716152 347388 367957
Net Profit Margin 5.86% 4.65% 25.92% 2.84% 77.52%
EPS (Earning Per Share) 29.74 6.48 4.87 6.88 16.27
Total Asset 674642 628612 365742 391866 41136
Total Debt 84985 97874 21951 11437 64233
Debt Ratio 72% 96% 13% 43% 36%
R&D Spending 6242 2168 8991 7212 1446
R&D Spending as % of Sales 8.79% 2.89% 7.96% 5.16% 7.56%

Automated Intelligence Corp Executive Summary Automated Intelligence Corp Swot Analysis Automated Intelligence Corp Vrio Analysis Automated Intelligence Corp Pestel Analysis
Automated Intelligence Corp Porters Analysis Automated Intelligence Corp Recommendations