The Dark Side Of Information Technology Case Study Analysis

Case Study Solution And Analysis

Home >> Kelloggs >> The Dark Side Of Information Technology >>

The Dark Side Of Information Technology Case Study Solution

The Dark Side Of Information Technology is presently one of the greatest food chains worldwide. It was established by Kelloggs in 1866, a German Pharmacist who initially released "FarineLactee"; a mix of flour and milk to feed babies and reduce death rate. At the same time, the Page siblings from Switzerland also found The Anglo-Swiss Condensed Milk Business. The 2 became rivals in the beginning but later on merged in 1905, leading to the birth of The Dark Side Of Information Technology.
Business is now a transnational business. Unlike other multinational business, it has senior executives from various countries and attempts to make choices considering the whole world. The Dark Side Of Information Technology presently has more than 500 factories worldwide and a network spread across 86 nations.


The function of Business Corporation is to enhance the quality of life of individuals 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


The Dark Side Of Information Technology's vision is to supply its clients with food that is healthy, high in quality and safe to eat. It wants to be ingenious and all at once comprehend the needs and requirements of its clients. Its vision is to grow quickly and offer products that would satisfy the requirements of each age. The Dark Side Of Information Technology imagines to establish a trained labor force which would help the business to grow


The Dark Side Of Information Technology's objective is that as currently, it is the leading business in the food market, it thinks in 'Excellent Food, Good Life". Its objective is to provide its consumers with a variety of choices that are healthy and finest in taste. It is focused on providing the very best food to its customers throughout the day and night.


Business has a wide variety of products that it uses to its clients. Its products include food for infants, cereals, dairy items, snacks, chocolates, food for animal and mineral water. It has around four hundred and fifty (450) factories around the world and around 328,000 employees. In 2011, Business was noted as the most rewarding organization.

Goals and Objectives

• Bearing in mind the vision and objective of the corporation, the company has actually laid down its objectives and objectives. These objectives and objectives are listed below.
• One goal of the company is to reach absolutely no landfill status. (Business, aboutus, 2017).
• Another goal of The Dark Side Of Information Technology is to lose minimum food during production. Usually, the food produced is lost even prior to it reaches the consumers.
• Another thing that Business is working on is to enhance its packaging in such a way that it would help it to decrease those issues and would also guarantee the delivery of high quality of its products to its clients.
• Meet global requirements of the environment.
• Construct a relationship based on trust with its consumers, company partners, employees, and federal government.

Critical Issues

Recently, Business Company is focusing more towards the technique of NHW and investing more of its revenues on the R&D innovation. The country is investing more on acquisitions and mergers to support its NHW technique. The target of the business is not attained as the sales were expected to grow greater at the rate of 10% per year and the operating margins to increase by 20%, offered in Display H.

Situational Analysis.

Analysis of Current Strategy, Vision and Goals

The existing Business strategy is based upon the idea of Nutritious, Health and Health (NHW). This strategy deals with the idea to bringing change in the customer choices about food and making the food things much healthier concerning about the health concerns.
The vision of this method is based on the key approach i.e. 60/40+ which merely means that the products will have a score of 60% on the basis of taste and 40% is based upon its dietary value. The products will be manufactured with additional nutritional worth in contrast to all other items in market acquiring it a plus on its dietary content.
This strategy was adopted to bring more yummy plus nutritious foods and drinks in market than ever. In competition with other companies, with an intent of keeping its trust over customers as Business Company has gotten more relied on by costumers.

Quantitative Analysis.

R&D Spending as a portion of sales are declining with increasing actual amount of spending shows that the sales are increasing at a greater rate than its R&D spending, and permit the business to more invest in R&D.
Net Earnings Margin is increasing while R&D as a portion of sales is declining. This indication also shows a thumbs-up 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 development instead of payment of financial obligations. This increasing financial obligation ratio posture a risk of default of Business to its financiers and could lead a declining share costs. In terms of increasing debt ratio, the firm needs to not spend much on R&D and must pay its present debts to reduce the danger for financiers.
The increasing danger of financiers with increasing financial obligation ratio and declining share rates can be observed by huge decrease of EPS of The Dark Side Of Information Technology stocks.
The sales growth of company is also low as compare to its mergers and acquisitions due to slow perception building of consumers. This slow growth also impede company to more spend on 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 Charts given up the Exhibits D and E.

TWOS Analysis

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

Strategies to exploit Opportunities using Strengths

Business should introduce more innovative items by big quantity of R&D Costs and mergers and acquisitions. It could increase the marketplace share of Business and increase the revenue margins for the company. It could likewise offer Business a long term competitive benefit over its rivals.
The global growth of Business need to be focused on market capturing of establishing countries by growth, attracting more clients through consumer's loyalty. As developing countries are more populated than developed nations, it could increase the consumer circle of Business.

Strategies to Overcome Weaknesses to Exploit Opportunities

Swot AnalysisThe Dark Side Of Information Technology should do cautious acquisition and merger of companies, as it could impact the consumer's and society's perceptions about Business. It should acquire and combine with those companies which have a market track record of healthy and healthy business. It would enhance the understandings of customers about Business.
Business must not only spend its R&D on innovation, instead of it should likewise focus on the R&D spending over assessment of cost of different healthy products. This would increase expense performance of its products, which will result in increasing its sales, due to decreasing prices, and margins.

Strategies to use strengths to overcome threats

Business must move to not just developing but also to developed nations. It ought to widen its circle to different nations like Unilever which runs in about 170 plus nations.

Strategies to overcome weaknesses to avoid threats

The Dark Side Of Information Technology ought to sensibly manage its acquisitions to avoid the threat of misconception from the customers about Business. It should obtain and merge with those countries having a goodwill of being a healthy company in the market. This would not just enhance the understanding of customers about Business but would likewise increase the sales, profit margins and market share of Business. It would likewise allow the business to utilize its prospective resources efficiently on its other operations instead of acquisitions of those organizations slowing the NHW technique development.

Segmentation Analysis

Demographic Segmentation

The group segmentation of Business is based on four aspects; age, gender, income and profession. For example, Business produces numerous items connected to children i.e. Cerelac, Nido, etc. and associated to adults i.e. confectionary products. The Dark Side Of Information Technology products are quite economical by nearly all levels, however its significant targeted customers, in terms of earnings level are middle and upper middle level clients.

Geographical Segmentation

Geographical division of Business is composed of its existence in practically 86 countries. Its geographical division is based upon two primary elements i.e. typical income level of the customer as well as the environment of the area. Singapore Business Company's division is done on the basis of the weather condition of the area i.e. hot, warm or cold.

Psychographic Segmentation

Psychographic segmentation of Business is based upon the character and life style of the consumer. For instance, Business 3 in 1 Coffee target those clients whose lifestyle is rather hectic and do not have much time.

Behavioral Segmentation

The Dark Side Of Information Technology behavioral segmentation is based upon the mindset understanding and awareness of the client. Its extremely healthy items target those clients who have a health mindful attitude towards their usages.

The Dark Side Of Information Technology Alternatives

In order to sustain the brand name in the market and keep the consumer undamaged with the brand name, there are two options:
Alternative: 1
The Company should invest more on acquisitions than on the R&D.
1. Acquisitions would increase overall possessions of the business, increasing the wealth of the business. Costs on R&D would be sunk cost.
2. The business can resell the gotten units in the market, if it fails to implement its method. Quantity spend on the R&D could not be restored, and it will be considered entirely sunk expense, if it do not give prospective results.
3. Spending on R&D provide slow development in sales, as it takes long period of time to introduce a product. Nevertheless, acquisitions supply fast outcomes, as it provide the business already developed item, which can be marketed soon after the acquisition.
1. Acquisition of company's which do not fit with the business's values like Kraftz foods can lead the company to deal with misunderstanding of customers about Business core worths of healthy and healthy products.
2 Large costs on acquisitions than R&D would send a signal of business's ineffectiveness of establishing innovative products, and would results in consumer's discontentment.
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 business not able to present new ingenious items.
Alternative: 2.
The Business must spend more on its R&D rather than acquisitions.
1. It would enable the company to produce more ingenious products.
2. It would offer the company a strong competitive position in the market.
3. It would enable the business to increase its targeted customers by presenting those items which can be provided to a totally new market section.
4. Innovative items will offer long term benefits and high market share in long term.
1. It would reduce the revenue margins of the company.
2. In case of failure, the whole costs on R&D would be thought about as sunk cost, and would impact the business at large. The danger is not when it comes to acquisitions.
3. It would not increase the wealth of business, which could provide a negative signal to the investors, and could result I declining stock costs.
Alternative 3:
Continue its acquisitions and mergers with substantial spending on in R&D Program.
Vrio AnalysisPros:
1. It would permit the company to present new ingenious items with less risk of converting the costs on R&D into sunk cost.
2. It would offer a favorable signal to the investors, as the overall possessions of the business would increase with its significant 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 offer the company a strong long term market position in terms of the company's total wealth in addition to in terms of innovative products.
1. Danger of conversion of R&D spending into sunk expense, greater than option 1 lower than alternative 2.
2. Risk of mistaken belief about the acquisitions, higher than alternative 2 and lesser than alternative 1.
3. Intro of less variety of ingenious products than alternative 2 and high number of innovative products than alternative 1.

The Dark Side Of Information Technology Conclusion

RecommendationsIt has institutionalized its strategies and culture to align itself with the market changes and consumer behavior, which has ultimately permitted it to sustain its market share. Business has established substantial market share and brand name identity in the metropolitan markets, it is recommended that the company ought to focus on the rural areas in terms of establishing brand loyalty, awareness, and equity, such can be done by creating a specific brand name allowance method through trade marketing tactics, that draw clear difference between The Dark Side Of Information Technology items and other competitor items.

The Dark Side Of Information Technology Exhibits

PESTEL Analysis
Governmental support

Altering standards of worldwide food.
Enhanced market share. Transforming perception in the direction of healthier items Improvements in R&D and QA departments.

Introduction of E-marketing.
No such effect as it is beneficial. Worries over recycling.

Use of resources.

Competitor Analysis
Business Unilever PLC Kraft Foods Incorporation DANONE
Sales Growth Highest possible considering that 8000 Highest after Service with much less growth than Company 9th Lowest
R&D Spending Highest possible considering that 2005 Highest possible after Company 9th Least expensive
Net Profit Margin Greatest considering that 2003 with rapid development from 2006 to 2012 As a result of sale of Alcon in 2017. Almost equal to Kraft Foods Incorporation Almost equal to Unilever N/A
Competitive Advantage Food with Nourishment and also health and wellness factor Highest possible number of brands with lasting methods Biggest confectionary and processed foods brand in the world Largest dairy items as well as mineral water brand name worldwide
Segmentation Middle and also upper center degree customers worldwide Specific consumers in addition to family group Every age and also Income Client Groups Center and upper middle level consumers worldwide
Number of Brands 8th 8th 4th 1st

Quantitative Analysis​
Analysis of Financial Statements (In Millions of CHF)
2006 2007 2008 2009 2010
Sales Revenue 76598 969393 461921 841833 947251
Net Profit Margin 1.96% 7.21% 25.65% 9.27% 97.69%
EPS (Earning Per Share) 82.17 6.69 4.11 9.17 72.65
Total Asset 618298 326573 321927 458581 47311
Total Debt 72297 19675 13971 75364 96197
Debt Ratio 39% 13% 13% 82% 88%
R&D Spending 4918 3836 8128 7549 7544
R&D Spending as % of Sales 4.33% 3.96% 9.18% 6.88% 3.91%

Executive Summary Swot Analysis Vrio Analysis Pestel Analysis
Porters Analysis Recommendations