strategic plan update ii

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RUNNING HEAD: STRATEGIC PLAN UPDATE II

Strategic Plan Update II

Team A: Angela Cesario, Joseph Faluyi, Frederick Fiddler, Basil Muhammad

STR/TM 581: Strategic Planning and Implementation in a Tech Environment

Liza Gorham

University of Phoenix

January 14, 2013

Introduction




A few different options exist when considering the Business Technology Management

(BTM) perspective. These options include the market development strategy, product

development strategy, and innovation strategy. Each option needs to be evaluated to reach the

conclusion on which strategy would best fit Kudler Fine Foods and their strategic plan.

Evaluation of Market Development Strategy

Market development focuses on finding new business in non-targeted audiences and non-

buying customers. Kudler currently targets people who are interested in specialty and gourmet

items to meet their culinary needs. Non-buying customers usually are people who wander into

the store looking for common items found in a grocery store. Market development will align with

the current focus of Kudler by continuing to support gourmet and specialty items yet catering to

new markets through stocking common grocery items that complement respective specialty

items. By adding these items to the stock, Kudler is able to compete with the common grocery

stores. Customers are able to potentially buy all their cooking products in one spot. This option

will require expansion of the store which will be will be an initial high cost. However, Kudler’s

customer base will increase and move closer into penetrating the grocer industry.

As a corollary, the market development strategy serves as an enabling strategy. By

including common grocery items in stock, customers are able to add gourmet and specialty items

to their cooking repertoire where they may have used generic items in a typical grocery store.

However, the inclusion of common items should not constrain the Kudler’s focus on gourmet

and specialty items. From a BTM perspective, the process of including a common item will be

repeatable if the complementing item is found to be a success. The organizational structure of the

common items can be treated as if it is a part of the normal inventory. Research must be

conducted on the particular complementing item to be sure that the common items does not




distract from the specialty item. Finally, technology should be used to link the complementing

item to the specialty item.

Evaluation of Product Development Strategy

Pearce & Robinson (2007) defines grand strategies as; “A master long-term plan that

provides basic direction for major actions directed towards achieving long-term business

objectives” (pg. 202). Overall grand strategies provide the ground work for the direction and

strategic actions that the firm needs to take. There are many different grand strategies, fifteen

examples according to Pearce & Robinson (2007) are; concentrated growth, market

development, product development, innovation, horizontal integration, vertical integration,

concentric diversification, conglomerate diversification, turnaround, divestiture, liquidation,

bankruptcy, joint ventures, strategic alliance, and consortia. The grand strategy that this

evaluation focuses on is product development.

According to Pearce & Robinson (2007) product development is needed when strategic

managers forecast that the present markets and products are inadequate in achieving the

company’s overall mission. Product development offers low cost and risk and is therefore a

viable option. Product development involves developing new products for the present markets.

Kudler Fine Foods appeals to a niche market that can be very particular about their food

ingredients and the authenticity of their food supplies. As Kudler Fine Foods strives to apply

product development it needs to be cognizant of the impact that developing new products will

have on its customers. Some examples of approaches that Kudler Fine Foods could take are;

rearranging the layout and overall presentation of goods in the store, explore modifications of

color, size and shapes of the different products and also look at product substitute options. There

are different levels of risks associated with each development option. The first option and least




risky that Kudler should explore is rearranging the layout of the store. Once this is done the

feedback of this impact on the customer should constantly be evaluated to see is this was the

right direction or not.

Evaluation of Innovation Strategy

Based on the business direction of Kudler Fine Foods to ensure customers’ satisfaction at

all times and grow its business become a leader in gourmet grocery industry (University of

Phoenix, 2012), it is important that Kudler Fine Foods develops niche capabilities and products

that can add value to its customers and continue to gain their loyalty. In today’s business, it is

more important than ever before for company to maintain customer’s loyalty due to the

aggressive nature of the competition in the industry in general. Most companies invest heavily in

research and development to combat this aggression and they are able to offer innovative product

and services that differentiate them in the marketplace. Kudler Fine Food leverages BTM

framework, to enable it to create a bridge between its business and technology. Kudler Fine

Food’s business innovation includes the application of appropriate technologies to communicate

it offering to its existing and potential customers. The technology innovation also enables Kudler

Fine Foods to advertise its product line to the public so that they can know its products and

services without necessarily visiting any of its store locations. Kudler’s business innovation

strategy aligns with its technology initiative, and allows it to better execute it business, manage

and better control its risks as well as increase its sales and profitability. Most companies today

understand that repeatable business process is one of the key ingredients of a successful business

and business technology is the enabler for this repeatable business (Pearce & Robinson, 2007).

Kudler Fine Food innovation strategy is powered by its business technology and as a result, it

becomes the central component of its overall business operation.




Conclusion

The best option for Kudler Fine Foods is the innovation strategy. The innovation strategy

best aligns with Kudler’s vision in creating a competitive advantage over other gourmet food

stores. From a BTM perspective the chosen strategy will allow the company to expand its

catering business, introduce marketing tactics, open new locations, reduce inventory turnover,

and create customer loyalty.

References:

Pearce, J. A., & Robinson, R. B. (2007). Strategic management: Formulation, implementation,

and control (10th ed.). New York, NY: McGraw Hill/Irwin.




University of Phoenix (2012). Kudler Fine Foods Virtual Organization. Retrieved on January 12,

2013 from

https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Internet/KudlerPort.ht

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