HI6006 Competitive Strategy - Final Assessment

Question1                                                                 (10 marks)

PepsiCo operates 45 plants, 490 distribution centres, warehouses and offices located globally, Australia, Chile, and Uzbekistan are being considered as a potential market for PepsiCo top global brands and everyday nutrient products.  As a senior executive for PepsiCo you and your team have decided to adopt the four strategies in the Ansoff matrix to expand and grow the business.

Required:

Illustrate and explain how each of the four quadrants would influence your choice of strategy.

Answer this question in about 400 words and include a diagram of the Ansoff Matrix.

Question2                                                                          (10 marks)

Given that the three countries mentioned in Q1 are not only geographically distant from PepsiCo’s home base in USA and each other but also have distinct differences in administrative, cultural and economic characteristics, illustrate and explain how the CAGE framework can be useful in prioritising PepsiCo’s international expansion strategy.

Answer this question in about 400 words and include an application of the CAGE model, showing your numerical assessment.

Question3                                                                      (10 marks)

Assume that you have accepted a job in Corporate Governance and on your first day in the role you come across the Performance Ladder illustrated below.

Required:

Use the numbers presented to determine the following:

1. If we are currently recycling 30% of our waste, how would you explain the improvement using the ladder?
2. Our carbon emissions are down by 8% year on year. Explain how this is good or bad relative to our targets.
3. We made a creditable improvement in switching to Renewable Energy Sources. How will this affect our Score in that particular objective (i.e. from …… to ……)?
4. Our consumption of fresh water did not reduce at all since last year. What is our score in that criterion?
5. Given the above information, calculate our current year’s performance to find out to what extent we have been successful in improving, on balance.

Question4                                                                             (10 marks)

Your friend has a successful small-scale manufacturing business located in Perth, Western Australia and is considering setting up a new factory in Vietnam in the belief that labour costs are cheaper there.

Required:

Provide your friend with an overview of International Entry Strategies, including considerations of Risk, Control, Costs to enable a more logical decision about which mode of entry will be most appropriate.

Answer this qestion in about 400 words

Question5                                                                               (10 marks)

CASE STUDY

Express Oil Change

Express Oil Change and Service Centers outperform the industry significantly in terms of customer transactions per day and store sales, for a host of reasons. The key to our success is to be more convenient and provide a better overall experience for the customer.

In terms of customer convenience, Express Oil Change is faster than most of our competitors—we do a ten-minute oil change, using a process made possible by our patented equipment, while the customer stays in the car. Mothers with kids in car seats especially enjoy this feature.

We also do mechanical work that other quick lube businesses don’t do. We change and rotate tires, do brake repairs, air conditioning, tune ups, and others. There is no appointment necessary for many mechanical services like tire rotation and balancing, and checking brakes. So, overall, we are more convenient than most of our competitors.

Each of Express Oil Change franchises has owner-equity to ensure that the latest technology is installed and utilized on every site

In terms of staffing our stores, full-time workers are all that we employ. Full-time workers are better trained and typically have less turnover. They therefore have more experience and do better quality work. We think incentives are very important. We use a payroll system that provides incentives to the store staff on how many cars are serviced each day and on the total sales of the store, rather than on increasing the average transactions by selling the customer items they did not come in for, which is what most of the industry does.

We don’t sell customers things they don’t yet need, like air filters and radiator flushes. We focus on building trust, by acting with integrity, to get the customer to come back and build the daily car count.

The placement of our outlets is another key factor. We place our stores in A-caliber retail locations. These are locations that may cost more than our competitors are willing or able to pay. We get what we pay for though; we have approximately 41% higher sales per store than the industry average.

Required:

Apply a Resource-Based View of the firm by integrating the P.R.O.F.I.T. model with the VRIO / VRHN model, to determine in which areas the firm has Relative Strengths or Weaknesses.

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