Strategic plan based on the SWOT analysis
Kellogg’s responds to the various forces in the market in order to remain ahead of its competitors and meet its long term and short term objectives. Firstly, the company embarks on new product development in order to introduce new brands into the market to compete with its competitors. This is in response to the fact that some of its products have reached the maturity stage. In addition, the company has invested heavily on customer relationship management practices in order to better understand the needs of its customers and better serve them. Instead of changing its strategy from trying to satisfy all the market segments to focusing on a narrower customer base, the company has continued investing in its supply chain and technology infrastructure. This has ensured continued customer satisfaction for all the customer segments, thus constantly broadening its revenue sources and achieving its goal of growing its internal net sales.
Furthermore, the company has intensified its promotional strategies for its products in order to continue persuading its customers to make purchases amid the competition emanating from the other companies. The product range has new flavors added such as the peanut butter-flavored cereals in order to take care of the taste conscious consumers, thus keeping up with the market trends.
Operational plan based on the SWOT analysis
Production at Kellogg’s has been optimized in order to cater for the ever-increasing demand for its products, especially the cereal brands which are preferred by the health-conscious consumers. Production plants are distributed across 18 countries to serve about 180 countries in all the continents (Businesscasestudies, 2014). The inventory management system put in place by the company ensures that wastage is minimized in its efforts to be the cost leader organization in its industry category. This has enabled the company to realize its goal of reducing its landfill rate by 20% from 2010 to 2015 (Environmental Leader, 2011). An elaborate distribution system has also been put in place through a sound infrastructure and supply chain across 180 countries.
The diverse human resources that are brought together by the company through shared values ensures that the company is on track towards its goals. The company’s philosophy of talent management breeds innovativeness (Kellogg’s, 2014). The growth and development programs for the employees also ensure that the company keeps in pace with the current management styles and new developments, giving the company competitive advantage over its rivals. The shared value philosophy also extends to suppliers through the company’s good relations with them through an elaborate system of supply chain management. This ensures that raw material supply is timely and that wastage is discouraged. The supply of the finished goods of the company is accomplished through its network of distributors throughout the 180 countries in order to ensure that the products are available to customers.
In addition, good management of the company has resulted in profitability that raises the company’s credit worthiness. According to Y Charts (2014), the debt-to-equity ratio of Kellogg’s is about 2.183, showing achievement of the company’s goal of improving financial flexibility.
Effect of planning decisions on the stakeholders
Planning is a very essential process in any business set-up. Planning gives a sense of direction to the internal and other connected stakeholders of the business so that all their efforts are directed towards the same objectives (Stevens, Loudon, Wrenn, & Mansfield, 2006). Planning decisions have the following effects on the stakeholders of Kellogg’s Company:
- Good planning of operations by the management gives potential investors the confidence to commit their funds in the company
- Good planning creates customer satisfaction through products which meet their needs
- It gives confidence to the company’s employees about the security of their jobs, hence reduces the overall employee turnover
- Good planning decisions increase the company’s ability to source for external funding from lenders and other financial institutions
- It creates goodwill from the governments who create the required environment for the business to thrive
- Good planning decisions give managers the security of tenure as the shareholders vote them back into office during subsequent annual general meetings as an incentive for the quality of decisions
- Good decisions give the shareholders a fair return on their investment
References
Businesscasestudies. (2014). Using New Product Development to Grow a Brand: A Kellogg’s Case Study. Web.
Environmental Leader. (2011). Kellogg’s Meets Waste Goal 5 Years Early. Web.
Kellogg’s. (2014). Our people. Web.
Stevens, R., Loudon, D., Wrenn, B., & Mansfield, P. (2006). Marketing planning guide. New York: Best Business Books, cop.
Y Charts. (2014). Business Cases. Web.