microsoft powerpoint - sm assignb presentation draft v5 2010521
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MBA Semester 2 : Strategic
Management Assignment B - GroupPresentation
Group Members
SID: 1221278
SID: 1163321
SID: 1129870
Module Code: BC415041S / AS1 / 2011/2 /011
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Topic: Fraser and Neave - BusinessLevel Strategy for Food & Beverage
Segment
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Agenda
Introduction
Analysis
Conclusion & Recommendations
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Fraser & Neave
Company Overview
Founded in Singapore by John Fraser & David Neave in 1883
Started with printing & diversified to aerated water, F&B &
Properties
Conglomerate listed in SGX & headquartered in Singapore 13000 employees in 20 countries
USD 5.69B Revenue in Fiscal 2011 with USD 584M profit
Current Chairman : Lee Hsien Yang
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Fraser & Neave (F&N)
Food & Beverage BusinessAsia Pacific Breweries Limited
F&N Holdings Bhd
F&N Foods Pte Ltd
Soft Drinks
Breweries
Dairies
Glass Containers
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History of F&N
Founded in 1883
Printing to Aerated water business
Listed in SGX
Diversification
Brewing business in 1931 Dairies in 1959
Property in 1990
Publishing & Printing in 2000
JV with Heinekan (Holland) in 1931 for brewing
Malaysian Breweries -> Asia Pacifc Beweries in 1990
Acquired majority control of Time Publishing in 2000
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History of F&N
Financial Trend
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Fiscal Year 2011 Financials
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Awards
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Vision & Mission
Vision - To be a world-class multinational
enterprise with an Asian base, providing superiorreturns with a focus on the Food & Beverage,
Properties and Publishing & Printing businesses.
Mission - To be a world-class multinational
enterprise providing superior returns to our
shareholders, excellent value for our customers anda rewarding career for our employees.
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Agenda
Introduction
Analysis
Conclusion & Recommendations
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New
Entrants
Suppliers
Substitutes
Power of Suppliers - Strong
Direct negotiation withsuppliers
Abundance of supply in the
market for inputs
Barriers to Entry - Low Low Barriers to Entry
(Except Regulation)
Power of Buyers -Moderate
Main distribution channels
(supermarkets, retail chains,vending machines and
convenience stores.
Buyers
Rivalry Amongst Competitors
Growth Prospects Vary By
Markets
Fast respond to consumer
trends and demands
Availability of
Substitutes
Several Substitutes(Soft drinks, Beers, etc)
Porters 5 Forces - Assessing F&B Industry
Attractiveness
Industry
Competitors
Intensity of
Rivalry
Assets Are Product
Quality, champion
brands Intense Rivalry of productsavailable in the vending
Machines
Competitive Price
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SWOT Analysis F&N
Well known brand
Strong Financial performance Singapore based (next food hub)
Customer Loyalty
Strong portfolio on Non
carbonated drinks
Health concerns that affect mainly
the soft drinks market Some of the brands are not
popular
Venture in to new emerging
markets
Leverage the Singapore Brand
New strategies of reformulation
for more natural drinks
Many successful brands to pursue
Competition From Coke, Pepsi &
local brands in other countries
Currency fluctuations
Geopolitical Adversities
Regulations
Opportunities Threats
Strengths Weaknesses
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F&Ns Four Criteria of
Sustainable CompetitiveAdvantages
2. Rare Capabilities Execute Dual Strategy to Neutralize Threats
or Exploits Opportunities
1. Valuable Capabilities Create Business Ecosystems Rather
Than Value Chains Which Are Linear
3. Costly-To-Imitate Capabilities Rivals Cant Easily Copy
People & Organizational Culture ?
4. Non-Substitutable Capabilities Fostering Both Centralized &
Decentralized Innovation ?
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F&Ns Focus areas
Management Development Programme
(MDP)
Quality Team
Dedicated team to create newProducts & Services every year
Innovation
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The three levels of strategy
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Business-level
Strategy
Which Good or
Service to Offer
Customers?
How toManufacture or
Create it?
How to
Distribute it?
Business-level Strategy Key Issues
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Types of Business-Level Strategy
Each Business-Level Strategy Involves aParticular Competitive Scope:
Broad Target (Industry Wide)
Narrow Target (Particular SegmentOnly)
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Business - Level: Porters Three Generic
Strategies
Overall Cost
LeadershipDifferentiation
Focus
Uniqueness Perceived ByThe Customer
Low Cost Position
Competitive Advantage
Strate
gicTarget
Industry Wide
Particular
Segment Only
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Porters Three GenericStrategies
Overall CostLeadership
Low-Cost-PositionRelative to a FirmsPeers
Manage Relationships Throughout the
Entire Value Chain
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Porters Three Generic Strategies(contd.)
Differentiation
Create Products and/or Services That areUnique and Valued
Non-priceAttributes For WhichCustomers Will Pay aPremium
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Narrow Product Lines, Buyer Segments,
or TargetedGeographic Markets
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Porters Three Generic Strategiescontd.
FocusStrategy
AttainAdvantages Either ThroughDifferentiation or Cost Leadership
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Integrated Cost Leadership/Differentiation
Strategy
Uniqueness Perceived ByThe Customer Low Cost Position
Competitive Advantage
Strate
gicTarget
Industry Wide
Particular
Segment Only
Overall Cost
LeadershipDifferentiation
Focus
Integrated Cost
Leadership/DifferentiationStrategy
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Combination Strategies: IntegratingOverall Low Cost and Differentiation
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How Firms Can Effectively Combine
the Generic Strategies of Overall CostLeadership and Differentiation.?
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Invests Heavily InPeople
EverythingBehind The Scenes IsSubject ToRigorous Control
A Leading F&B Provider in Asia
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F&N spends considerably in the following
areas:
Buying New Aircraft
Training
Marketing
Innovation
Dedicated funding for
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F&Ns Pursuit of Multiple Value
Disciplines
Product
Leadership
Operational
Excellence CustomerIntimacy
F&NsStrategy
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Key Drivers of F&Ns OperationalExcellence
Operational
Excellence5. Culture 1. Products
4. Comparative
Advantage2. Labor Costs
3. Productivity
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What Factors Can Explain F&Ns
Success?
Products
Incentives
Marketing
Owns
Breweries
TechnologyDeployment
Internal
Policies
Strategy
Consistent Performance
Top Management
Related
Operations Distribution
Comparative
Advantage
Legal
Systems
Unions
Low Costs Regulation
Cash Flow
Opportunistic
Purchasing
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Forces Shaping F&Ns Future
Strategy
FutureStrategy
Enhance Operations
Continued
Opportunities
EnhanceProducts/Services
Maintain Low Costs
Acquire leading players in
emerging countries & expand
Greater Use of Technology
Alliances
Extend Reach
Reduce Geographic
Dependence
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Agenda
Introduction
Analysis
Conclusion & Recommendations
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Conclusions & Recommendations
Lowering the cost of products while
maintaining quality
Form Joint Ventures to enter in to untapped
markets with huge potential, starting with
African countries.
Knowledge Management
More distribution channels for easy access
Continuous innovation
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