Oscar Mayer Case Study

1. ) At first, Marcus McGraw found the ch entirelyenge so complex and dictum it a difficult task because he had non sat deck to put down the ideas on paper and evaluate the situation c befully. He was average thinking of the difficult task ahead and not how to invade the problem. He was missing parts of the puzzle, he was not evaluating anything as save or trying to formulate or implement any strategy. He had no option, no solution immediately after he sound out the McTiernan report. He had not d cardinal any strategic planning thus, his prospect was different than after he had read the memos.After reading the memos from his colleagues, he cognize that he could count on them since they had great(p) ideas and were persons with great capability for these types of cin one caserns and issues, peculiarly when he read the one of his long duration colleague and friend. McGraw pursues that finish reservation process of gathering information, generating ideas, looking at the pro s and cons of the situation that Oscar Mayer faces by his associates. He follows them and his bear in mind guides him knowing that he can trust on his department managers. Marcus McGraw purses a decision making that is transp bent.He does not go for entirely one department he follows all quadruplet managers. He was unbiased in this way and was a good strategy as tumesce since the managers give that merchandise-driven strategy which is healthy for the firm. They are headspring market-oriented and are subject to distinguish the capabilities of Oscar Mayer just as they are able to match the guest value requirements to capabilities. They were cognizant that the market is more rivalrous, they as well pointed out that introducing wise lines of product could bring prosperity to Oscar Mayer, which is one of the suggestions that McTiernan had brought up.Therefore, McGraws decision making process of taking the ideas of all four managers was a wise one. 2. ) If McGraw chooses the favors of whole one department whence he is risking all different departments. In a business you cannot only favor and clothe in one department only. All departments are important components for success of the business. If you only centre on one department, then the other departments pull up stakes eventually knit thus the company is losing on other areas in the market where dough can be made.This also supposes that the firm no daylong has that diversity in products which reflects negatively on the company. McGraw can mitigate the defile by amend each of the departments so that they become more competitive in the market. He could also diversify in products just as was recommended by a couple of his managers thus making him a hooligan competitor on the market if adequately and carefully strategized. He result surely hold to invest quite a lot on publicise and promotion which will reduce their profits in the concise term however, they will experience growth and profi ts in the long-term.As mentioned, once each department is remediated and with the right strategy, Oscar Mayer will benefit and improve the sectors of quality, quantity and price. They have done it before and the can only be better and will concentrate in satisfying consumers needs and wants. 3. ) showtime of all, lets list the Strengths and Weaknesses. Strengths Well-known provoker, Technology Skills in R&D, Strong Distribution Channels, Relatively advanced Market Share, High Profit Margin, Successful History and Product Diversification. Weaknesses Relatively High Price, not Healthy (High fat content).Oscar Mayer has a relatively high market serving already, and a relatively low market growth. Due to its strengths, it already has a high market share and due to its weakness and the new edit out in the market which is looking for products with lower fat (healthier), and lower prices, Oscar Mayer is losing its market growth. This is obviously a great threat to Oscar Mayer in t erms of opposition since the consumers are now looking for lower prices in those products, as well as healthier fondnesss. This is detrimental to the firm on its entirety as fewer products sold would mean fewer bargains which mean less(prenominal) profit.The controversy also affects the second grunge since the decrease in sale of the Oscar Mayer products also affects Louis fecund as it is looked as a total, thus Louis prosperous revenues are compensating for the loss in Oscar Mayer. The investment decision then will change. The objectives are to increase annual production growth over the side by side(p) three years by 4% in volume. Products will need to be reduced due to the competition so this affects how much to invest in quality and on the outstanding strength on Louis Rich in order to keep up the good record.There is much advertising and promotion to do therefore they might have to lower the calculate figures for this expense if sales decrease. They need to advertise on the already breathing products, such as the health aspect of it, as well as on new products that will be produced. Therefore Oscar Mayer needs to go over that they can prosper in the competition with all the expense that waits. 4. ) From the four departmental options, Jim Longstreets advice conceivems more viable. Not only was Jims advice an effective one, but his ideas also passed McTiernans wish for improved convenience.What Jim is doing by this is what is called differentiation Strategy. The firm will provide a superior carrying into action product uniquely designed to provide value to their target interview and is well appreciated by them. Oscar Mayer will also use their strengths to tiller this strategy a successful one. Having used their strong ability of R&D, they are already aware of who the target audience is and what that are looking for. Two products have been designed for their needs which are Zappetites and Lunchables. With this innovation, Oscar Mayer has al l the potential and resources to remain the leader.The second best strategy I would scan is Jane Morelys idea. To obtain smaller companies that are competent and provide well-nighthing Oscar Mayer does not provide is indeed a good strategy. The only disadvantage is that OM would have to increase their debt to acquire these companies not being on the whole sure if these companies would conform to. denote and packaging would also have its cost, however it doesnt mean it wint benefit in the longer run. Thos have their benefits they hold great value when you count on consumer convenience and stigma growth.If the companies succeed then automatically there are great sales increases which bring to the highest degree profit. The least viable would be Robs idea of condescension Louis Rich. Having all the strengths and the brand name of Oscar Mayer and just letting it go would be not just a waste but a gigantic loss. OM has had the majority of the companys profits for a long time and has been the leading brand. For one, LR is increasing but at a slow pace. thence advertisements will be a huge expense which of course does not mean that it will increase the volume of sales.Therefore centralizing in just one brand, LR would not be a good idea for Oscar Mayer. 5. ) With the statistics effrontery we can observe that McGraw wants a 15% increase on operational income dapple the managers are projecting a decrease of 5. 2% from the menses year. If McGraw were to keep his A&P budget the same as last years, he would save $32MM over the managers projections. Therefore,one solution could be to effectively use the strengths of the product lines and the AP dollars by consolidating his sub-divisions.The subdivision Performance table demonstrates exactly where the successes and failures of each sub-division are, and also shows their strengths and weaknesses. We can see that A P for Oscar Mayer has been decreasing and operating income increasing slowly. On the other han d, Louis Richs A P expense has been increasing while operating income has also been increasing by a great difference. This is also a key factor in the success of LR and partly, although not much, wherefore OM has had a decrease in sales.Another factor in the decrease of Oscar Mayer brand is due to consumer apparent movement as well as increased competition in the market. Oscar Mayer has so far opted to lose market share rather than lower its price. Based on the analysis, there is more to lose ifthe Oscar Mayer brand is allowed to wilt over the Louis Rich Brand. Giving up on Oscar Mayer would mean losing its well realised, well recognized OM brand name and its equity. May be even future profitability may be lost if the trend towards white meat is only a temporary one.This can be seen inMcTiernans Report on consumer satisfaction survey, in which the red meat out performs in overall taste and compares well with respect to convenience. Therefore, another(prenominal) strategy is to build up the Oscar Mayer Brand, to merge the Louis Rich brand down the stairs Oscar Mayer, for example co-brand, and to introduce new packaging of their products (e. g. Lunchables and Zappetites), some white and some red meat to recapture the lostmarket share. To consolidate the diffusion and A&P spending around the Oscar Mayers well established brand.Actions In accordancewith the above strategy we would suggest that Oscar Mayer and Louis Rich Brand modify and develop an integrated strategy which would require altering the exist branding strategy to accommodate the consumer trends, to extend the product line and to competitively price the OM products. Oscar Mayer needs to also not lose the taste when improving the quality of the product healthier, which is another step that would be taken and at the same time be convenient. By maintaining the quality it already is impart its part to success.Another strategic goal is to achieve is long term gains and zip brand growth. With al l this said, we need not to forget to invest in LR in order for the brand to grow as well. 6. ) Of the two products Jim Longstreet suggested, I believe Lunchables is less likely to succeed especially since they are completely new to this product. Unlike Zappetites they had previously done Stuff n Burgers so they do have an idea of how to approach the new product. Zappetites would create original products that could also be used for lunch by certain consumers who impulse hat ready to eat product. Lunchables would be more difficult to succeed due to all the details that a lunch entails and the different wants of the consumers. They are already thinking of packing a chocolate treat with it as well not everyone eats or likes chocolates. Another issue with Lunchables is the ingredients. both(prenominal) of the ingredients they would want to use have a short shelf liveliness which would turn away many consumers. We need to keep in mind that everyone is different and have a different t aste, many individuals are picky.