Lowell General Physician Hospital Organization Case Study Solution

Business is presently one of the greatest food chains worldwide. It was established by Henri Lowell General Physician Hospital Organization in 1866, a German Pharmacist who initially launched "FarineLactee"; a mix of flour and milk to feed infants and reduce death rate.
Business is now a global business. Unlike other multinational business, it has senior executives from various countries and tries to make choices considering the entire world. Lowell General Physician Hospital Organization currently has more than 500 factories around the world and a network spread throughout 86 nations.

Purpose

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

Vision

Lowell General Physician Hospital Organization's vision is to supply its customers with food that is healthy, high in quality and safe to eat. Business imagines to establish a well-trained labor force which would help the company to grow
.

Mission

Lowell General Physician Hospital Organization's objective is that as presently, it is the leading company in the food market, it believes in 'Great Food, Good Life". Its mission is to supply its customers with a range of choices that are healthy and best in taste too. It is concentrated on offering the best food to its consumers throughout the day and night.

Products.

Business has a wide variety of products that it offers to its customers. Its items include food for babies, cereals, dairy items, 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 gainful company.

Goals and Objectives

• Remembering the vision and mission of the corporation, the business has set its goals and objectives. These goals and goals are listed below.
• One goal of the company is to reach absolutely no garbage dump status. It is working toward absolutely no waste, where no waste of the factory is landfilled. It motivates its staff members to take the most out of the by-products. (Business, aboutus, 2017).
• Another goal of Lowell General Physician Hospital Organization is to lose minimum food during production. Frequently, the food produced is lost even before it reaches the consumers.
• Another thing that Business is dealing with is to enhance its product packaging in such a method that it would help it to reduce the above-mentioned issues and would likewise guarantee the delivery of high quality of its products to its clients.
• Meet global requirements of the environment.
• Build a relationship based on trust with its consumers, organisation partners, employees, and government.

Critical Issues

Recently, Business Business is focusing more towards the technique of NHW and investing more of its revenues on the R&D technology. The country is investing more on acquisitions and mergers to support its NHW technique. However, the target of the business is not achieved as the sales were anticipated to grow higher at the rate of 10% annually and the operating margins to increase by 20%, given in Exhibition H. There is a need to focus more on the sales then the innovation technology. Otherwise, it might result in the declined income rate. (Henderson, 2012).

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The present Business method is based on the principle of Nutritious, Health and Health (NHW). This method handles the idea to bringing change in the client preferences about food and making the food stuff healthier concerning about the health concerns.
The vision of this strategy is based on the secret technique i.e. 60/40+ which simply implies that the products will have a score of 60% on the basis of taste and 40% is based upon its dietary value. The items will be manufactured with additional dietary value in contrast to all other products in market getting it a plus on its nutritional content.
This technique was embraced to bring more yummy plus healthy foods and beverages in market than ever. In competitors with other companies, with an objective of keeping its trust over clients as Business Business has acquired more relied on by costumers.

Quantitative Analysis.

R&D Costs as a portion of sales are declining with increasing actual amount of costs shows that the sales are increasing at a higher rate than its R&D costs, and enable the business to more invest in R&D.
Net Earnings Margin is increasing while R&D as a percentage of sales is decreasing. This indicator likewise shows a green light to the R&D spending, mergers and acquisitions.
Debt ratio of the company is increasing due to its spending on mergers, acquisitions and R&D advancement rather than payment of debts. This increasing financial obligation ratio present a danger of default of Business to its investors and could lead a declining share costs. In terms of increasing financial obligation ratio, the firm needs to not invest much on R&D and must pay its current financial obligations to decrease the danger for financiers.
The increasing danger of financiers with increasing financial obligation ratio and declining share costs can be observed by big decrease of EPS of Lowell General Physician Hospital Organization stocks.
The sales growth of business is also low as compare to its mergers and acquisitions due to slow perception building of customers. This sluggish growth also impede company 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 computations and Charts given in the Displays D and E.

TWOS Analysis

TWOS analysis can be utilized to derive different techniques based upon the SWOT Analysis provided above. A quick summary of TWOS Analysis is given up Display H.

Strategies to exploit Opportunities using Strengths

Business should introduce more innovative items by big amount of R&D Spending and mergers and acquisitions. It might increase the market share of Business and increase the revenue margins for the business. It might also offer Business a long term competitive advantage over its rivals.
The international growth of Business must be focused on market capturing of developing countries by expansion, drawing in more clients through consumer's commitment. As establishing nations are more populous than developed nations, it could increase the client circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Lowell General Physician Hospital Organization ought to do mindful acquisition and merger of companies, as it might impact the customer's and society's perceptions about Business. It ought to get and combine with those business which have a market credibility of healthy and healthy companies. It would improve the understandings of customers about Business.
Business needs to not just spend its R&D on innovation, rather than it ought to likewise concentrate on the R&D costs over assessment of expense of different nutritious items. This would increase cost performance of its items, which will result in increasing its sales, due to decreasing rates, and margins.

Strategies to use strengths to overcome threats

Business ought to move to not only establishing however likewise to industrialized nations. It ought to expand its circle to various countries like Unilever which operates in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

Lowell General Physician Hospital Organization should sensibly control its acquisitions to prevent the danger of misunderstanding from the customers about Business. It ought to get and merge with those nations having a goodwill of being a healthy business in the market. This would not just improve the understanding of consumers about Business but would also increase the sales, revenue margins and market share of Business. It would also enable the business to utilize its potential resources effectively on its other operations instead of acquisitions of those companies slowing the NHW strategy development.

Segmentation Analysis

Demographic Segmentation

The group division of Business is based upon four factors; age, gender, income and profession. For example, Business produces several items related to babies i.e. Cerelac, Nido, etc. and associated to adults i.e. confectionary products. Lowell General Physician Hospital Organization items are rather affordable by nearly all levels, however its major targeted clients, in terms of earnings level are middle and upper middle level customers.

Geographical Segmentation

Geographical segmentation of Business is made up of its presence in practically 86 countries. Its geographical division is based upon two main aspects i.e. average earnings level of the consumer as well as the climate of the region. Singapore Business Business's division is done on the basis of the weather of the area i.e. hot, warm or cold.

Psychographic Segmentation

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

Behavioral Segmentation

Lowell General Physician Hospital Organization behavioral division is based upon the attitude knowledge and awareness of the customer. For instance its extremely nutritious products target those clients who have a health conscious mindset towards their consumptions.

Lowell General Physician Hospital Organization Alternatives

In order to sustain the brand name in the market and keep the consumer intact with the brand, there are two options:
Alternative: 1
The Company should spend more on acquisitions than on the R&D.
Pros:
1. Acquisitions would increase total properties of the business, increasing the wealth of the company. Costs on R&D would be sunk cost.
2. The company can resell the gotten units in the market, if it fails to execute its technique. Quantity spend on the R&D might not be revived, and it will be considered totally sunk expense, if it do not offer potential results.
3. Spending on R&D supply sluggish development in sales, as it takes long period of time to present a product. Acquisitions offer fast results, as it offer the business currently developed product, which can be marketed quickly after the acquisition.
Cons:
1. Acquisition of company's which do not fit with the company's worths like Kraftz foods can lead the company to deal with misconception of customers about Business core values of healthy and nutritious products.
2 Large spending on acquisitions than R&D would send out a signal of company's inadequacy of establishing ingenious products, and would outcomes in customer's discontentment.
3. Big acquisitions than R&D would extend the product line of the company by the products which are currently present in the market, making business unable to introduce new ingenious products.
Alternative: 2.
The Business must spend more on its R&D instead of acquisitions.
Pros:
1. It would make it possible for the business to produce more innovative products.
2. It would offer the company a strong competitive position in the market.
3. It would make it possible for the business to increase its targeted customers by introducing those products which can be offered to a completely new market segment.
4. Innovative items will supply long term advantages and high market share in long run.
Cons:
1. It would reduce the profit margins of the business.
2. In case of failure, the whole spending on R&D would be considered as sunk cost, and would affect the company at large. The threat is not in the case of acquisitions.
3. It would not increase the wealth of company, which could provide a negative signal to the investors, and could result I decreasing stock prices.
Alternative 3:
Continue its acquisitions and mergers with significant spending on in R&D Program.
Pros:
1. It would allow the business to present brand-new innovative items with less threat of converting the costs on R&D into sunk cost.
2. It would offer a positive signal to the investors, as the overall assets of the company would increase with its substantial R&D costs.
3. It would not affect the revenue margins of the company at a big rate as compare to alternative 2.
4. It would provide the company a strong long term market position in terms of the business's total wealth as well as in regards to innovative items.
Cons:
1. Risk of conversion of R&D costs into sunk expense, greater than alternative 1 lesser than alternative 2.
2. Threat of misunderstanding about the acquisitions, higher than alternative 2 and lower than option 1.
3. Intro of less number of innovative items than alternative 2 and high variety of ingenious items than alternative 1.

Lowell General Physician Hospital Organization Conclusion

Business has remained the leading market gamer for more than a decade. It has institutionalised its techniques and culture to align itself with the marketplace modifications and customer habits, which has actually eventually allowed it to sustain its market share. Though, Business has developed considerable market share and brand identity in the urban markets, it is recommended that the business must concentrate on the rural areas in terms of developing brand name loyalty, awareness, and equity, such can be done by creating a specific brand allocation method through trade marketing methods, that draw clear distinction in between Lowell General Physician Hospital Organization products and other rival products. Lowell General Physician Hospital Organization must take advantage of 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 enable the company to establish brand equity for freshly presented and currently produced products on a greater platform, making the efficient usage of resources and brand image in the market.

Lowell General Physician Hospital Organization Exhibits