Menu

Harvard Management Co And Inflation Protected Bonds Case Study Solution

Case Study Solution And Analysis


Home >> Harvard >> Harvard Management Co And Inflation Protected Bonds >>

Harvard Management Co And Inflation Protected Bonds Case Study Solution

Business is currently one of the greatest food chains worldwide. It was established by Henri Harvard Management Co And Inflation Protected Bonds in 1866, a German Pharmacist who initially released "FarineLactee"; a combination of flour and milk to feed babies and decrease death rate.
Business is now a multinational company. Unlike other international companies, it has senior executives from different nations and tries to make decisions considering the entire world. Harvard Management Co And Inflation Protected Bonds currently has more than 500 factories worldwide and a network spread across 86 nations.

Purpose

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

Vision

Harvard Management Co And Inflation Protected Bonds's vision is to offer its clients with food that is healthy, high in quality and safe to consume. Business pictures to establish a trained labor force which would help the company to grow
.

Mission

Harvard Management Co And Inflation Protected Bonds's objective is that as currently, it is the leading company in the food market, it thinks in 'Good Food, Good Life". Its mission is to provide its consumers with a range of options that are healthy and best in taste also. It is concentrated on supplying the very best food to its consumers throughout the day and night.

Products.

Business has a wide variety of items that it offers to its consumers. Its products include food for babies, cereals, dairy products, treats, chocolates, food for animal and mineral 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 company.

Goals and Objectives

• Remembering the vision and mission of the corporation, the company has actually put down its goals and objectives. These goals and objectives are noted below.
• One objective of the company is to reach no landfill status. (Business, aboutus, 2017).
• Another goal of Harvard Management Co And Inflation Protected Bonds is to lose minimum food during production. Most often, the food produced is lost even before it reaches the clients.
• Another thing that Business is dealing with is to improve its product packaging in such a method that it would help it to minimize those issues and would also ensure the delivery of high quality of its products to its clients.
• Meet worldwide standards of the environment.
• Build a relationship based on trust with its customers, organisation partners, workers, and government.

Critical Issues

Recently, Business Business is focusing more towards the technique of NHW and investing more of its earnings on the R&D innovation. The country is investing more on acquisitions and mergers to support its NHW method. The target of the company is not attained as the sales were anticipated to grow greater at the rate of 10% per year and the operating margins to increase by 20%, given in Exhibit H. There is a need to focus more on the sales then the innovation technology. Otherwise, it may result in the declined profits rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The existing Business technique is based on the idea of Nutritious, Health and Wellness (NHW). This strategy deals with the concept to bringing change in the consumer choices about food and making the food things healthier concerning about the health problems.
The vision of this strategy is based on the secret approach i.e. 60/40+ which just suggests that the products will have a score of 60% on the basis of taste and 40% is based on its dietary worth. The items will be produced with extra dietary value in contrast to all other items in market acquiring it a plus on its dietary material.
This technique was adopted to bring more tasty plus nutritious foods and drinks in market than ever. In competitors with other companies, with an intent of maintaining its trust over clients as Business Business has actually gotten more trusted by costumers.

Quantitative Analysis.

R&D Spending as a percentage of sales are declining with increasing real quantity of spending shows that the sales are increasing at a greater rate than its R&D spending, and allow the business to more invest in R&D.
Net Profit Margin is increasing while R&D as a percentage of sales is declining. This indication also shows a green light to the R&D costs, mergers and acquisitions.
Debt ratio of the company is increasing due to its spending on mergers, acquisitions and R&D development rather than payment of financial obligations. This increasing financial obligation ratio present a threat of default of Business to its investors and could lead a declining share prices. For that reason, in regards to increasing debt ratio, the firm needs to not spend much on R&D and should pay its existing financial obligations to reduce the risk for investors.
The increasing risk of financiers with increasing debt ratio and declining share costs can be observed by huge decrease of EPS of Harvard Management Co And Inflation Protected Bonds stocks.
The sales development of business is likewise low as compare to its mergers and acquisitions due to slow perception building of consumers. This sluggish growth also hinder business to additional invest in its mergers and acquisitions.( Business, Business Financial Reports, 2006-2010).
Keep in mind: All the above analysis is done on the basis of calculations and Graphs given in the Exhibits D and E.

TWOS Analysis


TWOS analysis can be utilized to obtain various strategies based on the SWOT Analysis offered above. A short summary of TWOS Analysis is given up Display H.

Strategies to exploit Opportunities using Strengths

Business ought to present more ingenious products by big quantity of R&D Spending and mergers and acquisitions. It might increase the market share of Business and increase the earnings margins for the company. It could likewise supply Business a long term competitive benefit over its competitors.
The global growth of Business need to be focused on market catching of developing nations by expansion, attracting more clients through client's loyalty. As developing countries are more populous than developed countries, it could increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisHarvard Management Co And Inflation Protected Bonds must do careful acquisition and merger of companies, as it might impact the consumer's and society's understandings about Business. It should obtain and merge with those business which have a market track record of healthy and healthy business. It would enhance the perceptions of customers about Business.
Business ought to not just spend its R&D on development, instead of it needs to likewise concentrate on the R&D costs over examination of expense of various healthy products. This would increase expense efficiency of its items, which will result in increasing its sales, due to decreasing prices, and margins.

Strategies to use strengths to overcome threats

Business must transfer to not only establishing however likewise to industrialized countries. It should widens its geographical expansion. This large geographical expansion towards establishing and developed nations would decrease the risk of possible losses in times of instability in numerous countries. It should widen its circle to various nations like Unilever which operates in about 170 plus countries.

Strategies to overcome weaknesses to avoid threats

Harvard Management Co And Inflation Protected Bonds ought to wisely manage its acquisitions to avoid the danger of mistaken belief from the consumers about Business. It needs to obtain and combine with those countries having a goodwill of being a healthy company in the market. This would not just improve the understanding of customers about Business but would also increase the sales, profit margins and market share of Business. It would likewise make it possible for the company to utilize its potential resources efficiently on its other operations rather than acquisitions of those companies slowing the NHW strategy development.

Segmentation Analysis

Demographic Segmentation

The market division of Business is based on four factors; age, gender, income and occupation. For instance, Business produces numerous products associated with infants i.e. Cerelac, Nido, and so on and related to adults i.e. confectionary products. Harvard Management Co And Inflation Protected Bonds products are quite cost effective by almost all levels, but its major targeted consumers, in regards to income level are middle and upper middle level clients.

Geographical Segmentation

Geographical division of Business is made up of its existence in almost 86 nations. Its geographical segmentation is based upon two primary elements i.e. average income level of the customer as well as the climate of the region. Singapore Business Company's division is done on the basis of the weather condition of the region i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic division of Business is based upon the personality and lifestyle of the consumer. For example, Business 3 in 1 Coffee target those clients whose life style is quite busy and don't have much time.

Behavioral Segmentation

Harvard Management Co And Inflation Protected Bonds behavioral segmentation is based upon the mindset understanding and awareness of the consumer. Its highly nutritious items target those clients who have a health conscious attitude towards their consumptions.

Harvard Management Co And Inflation Protected Bonds Alternatives

In order to sustain the brand name in the market and keep the consumer undamaged with the brand, there are 2 options:
Option: 1
The Business needs to spend more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase overall properties of the business, increasing the wealth of the company. 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. Nevertheless, quantity spend on the R&D could not be restored, and it will be thought about entirely sunk expense, if it do not offer prospective results.
3. Investing in R&D offer sluggish development in sales, as it takes very long time to introduce a product. However, acquisitions provide quick results, as it provide the company already developed product, which can be marketed not long after the acquisition.
Cons:
1. Acquisition of company's which do not fit with the company's values like Kraftz foods can lead the company to face mistaken belief of consumers about Business core worths of healthy and healthy products.
2 Big costs on acquisitions than R&D would send out a signal of company's ineffectiveness of establishing ingenious items, and would outcomes in consumer's frustration.
3. Large acquisitions than R&D would extend the line of product of the company by the items which are currently present in the market, making business unable to introduce brand-new ingenious products.
Alternative: 2.
The Business ought to spend more on its R&D instead of acquisitions.
Pros:
1. It would enable the business to produce more ingenious products.
2. It would supply the company a strong competitive position in the market.
3. It would make it possible for the company to increase its targeted consumers by presenting those items which can be provided to an entirely new market section.
4. Ingenious items will provide long term benefits and high market share in long run.
Cons:
1. It would decrease the revenue margins of the company.
2. In case of failure, the entire spending on R&D would be thought about as sunk expense, and would affect the business at large. The threat is not when it comes to acquisitions.
3. It would not increase the wealth of business, which might supply a negative signal to the investors, and might result I decreasing stock rates.
Alternative 3:
Continue its acquisitions and mergers with significant costs on in R&D Program.
Vrio AnalysisPros:
1. It would permit the business to introduce new ingenious items with less threat of transforming the spending on R&D into sunk cost.
2. It would offer a favorable signal to the investors, as the general assets of the business would increase with its substantial R&D spending.
3. It would not affect the earnings margins of the business at a big rate as compare to alternative 2.
4. It would provide the business a strong long term market position in regards to the business's total wealth in addition to in terms of ingenious products.
Cons:
1. Risk of conversion of R&D spending into sunk cost, greater than alternative 1 lower than alternative 2.
2. Threat of misconception about the acquisitions, higher than alternative 2 and lesser than alternative 1.
3. Introduction of less variety of innovative products than alternative 2 and high variety of ingenious items than alternative 1.

Harvard Management Co And Inflation Protected Bonds Conclusion

RecommendationsIt has actually institutionalised its techniques and culture to align itself with the market changes and client behavior, which has actually eventually enabled it to sustain its market share. Business has established significant market share and brand identity in the urban markets, it is advised that the business ought to focus on the rural areas in terms of developing brand loyalty, awareness, and equity, such can be done by developing a particular brand name allowance method through trade marketing methods, that draw clear difference in between Harvard Management Co And Inflation Protected Bonds items and other rival items.

Harvard Management Co And Inflation Protected Bonds Exhibits

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

Altering standards of worldwide food.
Improved market share.
Changing understanding towards much healthier items
Improvements in R&D and also QA divisions.

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

Use of sources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest possible because 9000
Highest possible after Organisation with less growth than Organisation 2nd Most affordable
R&D Spending Highest given that 2004 Greatest after Business 5th Cheapest
Net Profit Margin Greatest since 2007 with fast development from 2002 to 2015 Because of sale of Alcon in 2019. Nearly equal to Kraft Foods Unification Nearly equal to Unilever N/A
Competitive Advantage Food with Nourishment as well as health and wellness factor Greatest number of brand names with lasting techniques Biggest confectionary as well as processed foods brand name worldwide Largest milk products as well as mineral water brand on the planet
Segmentation Middle and top middle degree customers worldwide Specific clients along with household group Every age as well as Revenue Client Teams Middle and top center level consumers worldwide
Number of Brands 2nd 8th 7th 5th

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 18461 859188 945473 485716 396225
Net Profit Margin 6.44% 3.73% 29.77% 1.63% 98.66%
EPS (Earning Per Share) 74.85 1.37 3.33 7.22 92.64
Total Asset 375659 112727 476616 953666 75558
Total Debt 78632 18633 64337 84199 98838
Debt Ratio 55% 21% 96% 51% 21%
R&D Spending 4266 9312 8228 6238 9443
R&D Spending as % of Sales 6.35% 9.88% 3.63% 3.36% 4.57%

Harvard Management Co And Inflation Protected Bonds Executive Summary Harvard Management Co And Inflation Protected Bonds Swot Analysis Harvard Management Co And Inflation Protected Bonds Vrio Analysis Harvard Management Co And Inflation Protected Bonds Pestel Analysis
Harvard Management Co And Inflation Protected Bonds Porters Analysis Harvard Management Co And Inflation Protected Bonds Recommendations