Strategy and change management at The Continental White Cap
Executive Summary
The tremendous technological changes taking place around the world are positively and intensively affecting business organizations (David Sarpong & Nicholas O’Regan, 2014). This paper focuses on strategic issues at The Continental White Cap, a company located in the United States of America. According to SWOT analysis, many factors are affecting the organization among them, including stiff competition and the ever-changing technological needs. Additionally, there are internal factors that affect the organization. However, strategic management has made it possible for the organization to link its internal needs to the uncontrolled external; factors so that they can be competitive and successful in the long run. Through strategic management, the organization has been able to come up with robust frameworks of improving on its strengths and taking every opportunity emerging in the market for the benefit of the organization.
Additionally, the organization has emphasized constant and thorough market research being done so that the current and emerging threats can be dealt with appropriately. The organization has also not neglected the fact that they have weaknesses, but have focused on how to deal with them squarely to avoid and adverse effects on themselves. Furthermore, the organization has stressed using different parameters like the balanced scorecard to measure and evaluate the different aspects of the organization.
Company Background
The White continental cap is a company that has a long and significant history (Supriyanto, 2015). The Company was founded back in the year 1926 by the three White brothers, namely William, George, and Philip. The three started the Company by operating an old box factory on Goose Island in Chicago, Illinois. The Company began with a single product, which was “side-seal” pry-off closure. However, three years down the line in 1929, the Company developed the Vapor Vacuum quick sealing process. Through this new product, packages could be sealed at high speeds and efficiently, which translated to 100 jars per minute. Through this innovation, the Company helped and contributed significantly to revolutionizing the food industry at large. As time went on, the Company continued to grow due to increased volumes of sales and high demand for its products. The first international expansion step took place in 1932, where the Company signed a license agreement with Wallace Tin Stamping, a company in England.
Additionally, due to its growing operations, the Company increased its employees from 2oo to 1,100. In 1956 the Company was acquired by Continental Can Company through a stock exchange, and the Company changed its name to Continental White Cap. Since then up to now, the Company has continuously undergone many positive changes that have made it be where it is now and become a global company. Don't use plagiarised sources.Get your custom essay just from $11/page
1.1. Current Situation and the Company’s position. 1
1.2. External environment analysis. 2
1.2.1.3. Social, cultural factors. 4
1.2.1.4 Technological factors. 4
1.2.1.6. Environmental factors. 6
1.2.2. Porter’s Five Forces. 6
1.2.2.1. Threat of new entrants. 7
1.2.2.2. Substitute products/services. 7
1.2.2.3. Rivalry among existing firms. 8
1.2.2.4. Bargaining power of suppliers. 8
1.2.2.5. Bargaining power of customers. 8
2.2 Drivers for formulating new strategies. 9
3.0. Section Three: Porter’s Generic Strategies. 10
3.4. Differentiation Focus. 11
3.5. The Balanced Scorecard. 12
4.0. Section Four: McKinsey’s 7S. 14
Table of figures
Figure 2 Porter’s five forces. 7
Figure 3 Porter’s generic strategies. 10
Figure 4 Balanced Scorecard. 12
Figure 5 McKinsey’s 7S model 14
Introduction
Today the world is termed as a global village due to the increased use of emerging technologies among them, including emails, social media platforms and the internet at large (Supriyanto, 2015). These new and emerging technologies have made the business environment to become dynamic and hard to predict since no one knows what these technologies can bring in the future. However, this does not mean that business organizations cannot do anything concerning these changes. Many business organizations are aware of these emerging technologies, and the best they can do is to plan and come up with a robust and flexible framework of adopting these changes for the benefit of the organization. Additionally, through strategic management models and knowledge business organizations have learned the importance of prior planning and making better decisions to help them become competitive and successful in the long run. These technologies have made it easier for other organizations to enter the market with new products hence making competition to be very stiff among the existing organization. However, through SWOT analysis, an organization can conduct a complete evaluation of itself and get to know about its Strengths, Weaknesses, Opportunities and threats. The above four are vital since they provide valuable insights into the management on what can be done to improve the state of things in the organization (Supriyanto, 2015). The Continental White Cap is a company that has managed to succeed and effectively go through these technological changes successfully and take advantage of them by improving itself. Since the organization was established in 1926 up to now, the Company has seen and underwent a series of major technological innovations that have made it a global company.
1.0. Section One
1.1. Current Situation and the Company’s position
As of today, Continental White Cap is a stable and very competitive company (Gębczyńska, 2016). The Company has managed to adopt the emerging technologies and come up with a flexible organization that can adapt any positive changes that come along. Many players also characterize the market, and with the increased technologies, other companies are joining too. Consequently, this has made the competition among the existing firms to be very stiff and call for reliable measures to be deployed to handle this competition. Survival is a must in a market that is characterized by many firms. If an organization does not plan on how they can handle the competition, then they risk being wiped out of the market in the long run. The market is continuously growing, and this means that the organization must be prepared to handle any changes and adapt them for the good of the organization. In a similar vein, the organization has also been determined and committed to being creative and innovative. Bearing in mind that the needs and interests of customers are changing too, organizations need to conduct market research and know about these dynamic needs of customers. Building strong symbiotic relationships with customers is paramount to an organization aiming at having loyal customers. In the same vein, an organization ought to commit itself to produce and offering nothing but the best and quality products to its customers. The Continental White Cap has been able to evaluate its internal and external factors through SWOT analysis and PESTLE analysis. Through the above, they have been able to learn about the changing needs of the customers, weaknesses, threats, and opportunities they can use to expand their operations. Additionally, through the above tools, the organization has managed together and analyze important information about its environment hence able to plan and implement a strategic plan that can help them remain competitive in the long run.
1.2. External environment analysis
There are many external factors affecting business organizations. The Continental White Cap operates in an environment that is highly dynamic and influenced by several external factors. Additionally, an organization aiming at becoming successful and competitive must identify and analyze these external and link them with the internal factors so that they can achieve strategic of doing all their activities. Analyzing these external factors can be done via several tools include PESTLE and Porter’s five forces.
1.2.1. PESTLE (Political, Economic, Socio-cultural, Technological, Legal and Environmental factors)
The diagram below shows the PESTLE factors.
1.2.1.1. Political factors
This is the first external factor that affects organizations. It is quite investable and unavoidable for an organization to face political changes that can affect them (Kotzian, 2016).Issues to do with policymaking and formulation can affect how a business organization operates. Additionally, political instability throws the whole country and the environment in which the organization operates into disarray hence hindering their processes. The government plays a very vital role in regulating and monitoring the operations of organizations. Among these include setting quality standards and ensuring that organizations do not manipulate consumers. The Continental White Cap deals with products that are used to seal foodstuffs. The government, therefore, has a right to interfere and inspect the quality of the seals and caps used to ensure that they are of the recommended quality. If any of the quality standards and issues are not observed, then the operations of the organization can be brought to a halt. It is, therefore, important for the organization to collaborate with regulatory and other government bodies so that they can be on the safe side at all times. Failure to comply with government revaluations can make the organization lose its license, and this affects its operations too. Additionally, the government, through its regulatory bodies, need to work together and ensure that they don’t come up with stringent or manipulative policies that can affect the business organization from doing their operations swiftly.
1.2.1.2 Economic factors
This is the second factor that affects the organization. It is quite hard to control economic factors. Economic factors can be micro or macro, and all of them directly affect the existence and stability of an organization (Kotzian, 2016).The Continental White Cap is also affected by these factors. The first factor is the high-interest rates. This has made it hard for organizations to borrow funds to expand and facilitate their operations. Additionally, high costs of land and labour are making it hard for the organization to get affordable but quality labour. Another key economic factor is inflation. Inflation makes the cost of doing business to be high, raises the costs of living, and the yield made from government and corporate bonds. Lastly but not least is demand and supply. The above two directly affect the performance of organizations since they are related, and anything affecting one of them causes an effect on the other.
1.2.1.3. Social, cultural factors
This is the third factor affecting the organization. Different people have various cultures, and they all have different ways of doing things (Kotzian, 2016). However, these social and cultural practices affect business organizations in one way or another. American society is diverse, and this means that the organizations ought to know the different appropriate methods that can be used to interact with their different customers without disappointing them. This means that the organization ought to be aware of the ethnic, religious, and other affiliations that help them in interacting with their customers well. Additionally, the organization ought to ensure that they manufacture products that do not compromise the culture of their customers.
1.2.1.4 Technological factors
The ever-increasing use of the internet and other emerging technologies by business organizations has made it possible for them to become highly efficient and effective (Kotzian, 2016). Through these emerging technologies, Continental White Cap has been able to creatively come up with new products that meet the needs of their customers. This has, therefore, helped to become highly competitive and successful in the market despite the stiff neck competition it faces. The use of emails and social media platforms like Facebook, Twitter, and Instagram, among others, has made the organization have access to new markets and potential customers’ altogether. Additionally, the excessive use and application of these technologies have made it easy for the organization to have an automated machine and better production methods that have greatly boosted the productivity and profitability of the organization. This is evident from the organization since it is not as it was when it was established. The various technological changes that the organization has experienced since it was established has helped in moulding it and reshaping it to become a global and efficient organization. Additionally, through these technologies, the organization has adopted better and effective methods of communicating to their stakeholders and customers, which is vital in making the organization successful. The use of emails and other electronic means of communication has made it possible for the organization to communicate with its customers at any time. Additionally, the organization can get feedback about their processes and any organizational changes they would like to be implemented as suggested by the customers.
1.2.1.5. Legal factors
Business organizations need to ensure that they adhere to the legal regulations as stipulated by the government and other regulatory bodies (Kotzian, 2016).Today there are many legal factors that organizations ought to observe if they want to remain operational and get approval from the government. Some of the legal factors directly affecting the Continental White Cap include the following: Industry laws and regulations, taxation, consumer protection issues, employment, among many others. Bearing in mind that the competition is very stiff in the market, some organizations may think of using rogue methods of doing business to have more customers. However, the availability of industry laws and regulations has greatly helped in ensuring that organizations stick to healthy ways of competition. Secondly is that it is expected that the organization complies with the stipulated tax regulations. This means that the organization has to remit taxes as expected without evading. Thirdly there are many regulations and laws when it comes to employee protection. The organization ought to commit itself to adhere to these regulations if to avoid being dragged into lawsuits that can taint their image and operations in the long run.
1.2.1.6. Environmental factors
The increased use of emerging technologies has made the organization to buy complex machines that they use to manufacture their products (Kotzian, 2016). However, some of these machines emit toxic substances that pose a great danger to the environment. The increased use of machines using fuel and other resources to be powered is increasingly affecting the environment and leading to global warming in the long run. However, to control organizations, government and other environmental stakeholders have come together to ensure that sustainable and environmentally friendly methods of production are used. The continental White Cap has been on the forefront adhering to these environmental regulations by ensuring that they use renewable sources of energy and eco-friendly raw materials that do not have high levels of toxics. Additionally, failure to adhere to environmental regulations can lead to an organization being closed since they pose a great danger to the existence of the environment and the health of the people around them. In a similar vein, a government that advocates for the use of highly expensive processes and machines to reduce the toxicity of materials makes the production and operational costs high, making organizations face a hard time while undertaking their operations.
1.2.2. Porter’s Five Forces
The porter’s five forces help an organization to understand the competition they are facing in the market and coming up with strategies of handling the competition to boost its profitability and competitive advantage (Melahat Önören; Tayfun Arar & Gülşen Yurdakul, 2017).The diagram below shows five of porter’s five forces.
1.2.2.1. Threat of new entrants
The ever-increasing technologies are drawing many organizations into the industry that the Company operate (Fung, 2014) s. This is a threat to them since these companies come with new products and new strategies that can outwit them in the market.
1.2.2.2. Substitute products/services
The availability of substitute products makes it easy for consumers to have alternatives, and in the long run, they may end up opting to go for the other products too (Melahat Önören; Tayfun Arar & Gülşen Yurdakul, 2017). This will mean that the organization will end up losing its customers in the long run. The substitute products include other plastic packages manufactured and sold at lower prices by other organizations in the market.
1.2.2.3. Rivalry among existing firms
The stiff competition among existing competition makes it hard for an organization to operate. To handle the competition, the organization needs to be creative and innovative. This will help them have new products and effective methods of dealing with their customers.
1.2.2.4. Bargaining power of suppliers
If the suppliers are powerful, they end up controlling the prices of raw materials (Melahat Önören; Tayfun Arar & Gülşen Yurdakul, 2017). This means that the production costs will be high, and the organization will end up manufacturing expensive products that are not the customer’s choice.
1.2.2.5. Bargaining power of customers
This is the last factor, and it entails the power that customers have. Customer power primarily comes from competition and the existence of many firms in the market. When there are many firms in the industry, then the customers have an opportunity of choosing where to get products. Additionally, when the customers have this power, they make the prices of products to be affordable.
2.0. Section Two
2.1. Evaluating findings
| Opportunities | Threats |
| ü PESTLE –Tech. The organization needs to adopt new technologies as opportunities for growth. | ü PESTLE – Political, Political instability culminates to unfavorable business environment. |
| ü PESTLE – Economic. The organization needs to take advantage of the right economic conditions to facilitate growth. | ü Porter’s five forces – new entrants. New firms in the industry intensify competition affecting the operations of the organization. |
| ü Porter’s – Competition-The organization should diversify its operations to handle the competition. | ü Porter’s five forces – substitute products. Substitute products may make the organization lose customers. |
| ü PESTLE –Environmental-Scanning environmental factors ought to help the organization invest in new opportunities. | ü Porter’s five forces involve the bargaining power of suppliers. This makes the prices of raw materials to be high, raising the cost of production. |
2.2 Drivers for formulating new strategies
2.2.1. Technology
From the above analysis, several things can be said concerning the external environment that the Continental White Cap operates in (Fung, 2014). The first is that the critical drivers of change in the organization are technology and economic factors. Through the emergence of new technologies, the organization has had uncountable opportunities of reshaping itself and coming up with new products to meet the needs of its customers. From the inception of the organization up to now, the technological aspect has remained central as the key catalyst of the growth and success experienced by the organization. Additionally, through these new technologies, the organization has adopted improved and efficient machines of doing their activities, and this has helped them in becoming a successful organization. Therefore, the new and emerging technologies have much improved in driving the organization from one phase of growth to another smoothly.
2.2.2. Economic factors
Secondly, the availability of suitable and favourable economic factors has also played a vital role in driving the organization into success (Fung, 2014). With low-interest rates and a lesser likelihood of inflation to occur, the organization has found itself running smoothly and efficiently while planning and implementing its expansion plans. When the economic factors are favourable, it means that a lot of money is in circulation, and business organizations are running smoothly. Therefore, with the above two factors have made the organization get numerous opportunities for expanding and establishing itself in different markets. They ought to grasp these opportunities as soon as they are identified as a way of dealing with competition.
3.0. Section Three: Porter’s Generic Strategies
The porter’s generic forces are usually used by an organization so that they can know how to get a competitive advantage in the industry.
Figure 3 Porter’s generic strategies
3.1. Cost leadership
This is the first strategy that the organization can use to obtain a competitive advantage (Fung, 2014). This entails the organization having the lowest prices on their products in the market. When an organization has the most affordable products, then they attract many customers since consumers are known to go for affordable and quality products. Consequently, this makes the organization get a competitive advantage since they have a large customer base.
3.2. Differentiation
In this, the organization ought to focus on becoming creative so that they can have unique products in the market (Fung, 2014). Through this, the organization gets an opportunity of differentiating its products from others in the market. Additionally, the organization gets a chance of coming up with products that meet customer needs and interests so that they can always satisfy them. The image below shows the different generic strategies.
3.3. Cost focus
In this, an organization ought to be focused on how they can have their prices affordable on their products. However, this strategy works best in a narrow market. Additionally, through this strategy, the organization remains the only one offering the most affordable products, which gives them a strategic competitive advantage.
3.4. Differentiation Focus
In this, an organization commits itself and comes up with appropriate frameworks of remaining the only one having unique products (Fung, 2014). It also works best in a narrow market, and it dramatically helps an organization to remain at the top when it comes to offering quality and unique products. Additionally, it makes an organization have dynamic and reliable ways of meeting the ever-changing needs and interests of its customers, and this consequently gives them a competitive advantage in the long run.
The Continental White Cap operates in a market that is characterized by stiff competition they ought to go for the differentiation as their strategy to attain a competitive advantage. Through this, the organization will commit itself to manufacture unique products that meet the needs and interests of their customers. Additionally, when the organization commits itself to satisfy their customers, they improve and build customer loyalty which is vital to have reliable customers in the long run.
3.5. The Balanced Scorecard
The balanced scorecard is usually used by organizations to help them look at the different aspects of an organization and how they can improve them to make an organization successful and competitive.
The customer-the organization ought to look at how they are performing in terms of meeting the needs and interests of their customers (Kwang Mo Yang; Young Wook Cho; Seung Hee Choi; Jae Hyun Park & Kyoung Sik Kang, 2010). Customers are the most critical stakeholders in any organization since without them will render the organizations non-operational. Therefore, the organization ought to be committed to ensuring that they make their customers satisfied by giving them affordable ad quality products.
Financial-In this, the Continental White Cap ought to look at how they are performing financial and come up with robust financial management methods. In this, an organization looks at how their profitable they are and what they can do to improve. Additionally, the organization comes up with effective auditing methods that can help them ascertain any financial loopholes and employ the appropriate strategies to deal with them.
Internal processes-In this, an organization gets an opportunity of looking at their processes and what they ought to do to attain efficiency (Kwang Mo Yang; Young Wook Cho; Seung Hee Choi; Jae Hyun Park & Kyoung Sik Kang, 2010). In this, an organization looks at aspects like employee satisfaction, core competencies, and customer satisfaction, among many others. These are the activities that create value for the organization, and the organization ought to be keen and careful when it comes to them if they want to be successful.
Learning and growth-In this, the organization focuses on the opportunities they can use to grow, expand, and diversify their operations. Market research is vital, and the organization ought to take competition as an opportunity of exploring new opportunities for growth. Additionally, from the mistakes that the organization does, they ought to make them as learning opportunities to help them become better and avoid repeating the same mistakes.
Therefore, the Continental White Cap ought to look at the above four factors when coming up with a strategy. As we have seen, the strategy selected satisfactorily touches on each of the above factors; hence the strategy can be used by the organization.
4.0. Section Four: McKinsey’s 7S
This model is primarily used by an organization to look at the different internal processes and organizational design so that they can know if they are o the right track towards achieving their seta goals and objectives (Alam, 2017). Additionally, the model will help the Continental White Cap facilitate organizational change and have an easy way of implementing a new strategy. The diagram below shows the 7S model.
4.1. Strategy
A strategy is a framework that is developed by an organization to enable them to achieve their goals, objectives, gain a competitive advantage, and successfully compete in the market. Additionally, the Continental white Cap out to have a strategy that is in line with the organization’s vision, mission, and values.
4.2. Structure
This focuses on the organizational units existing in a company (Alam, 2017). This will help the Continental White Cap have a clear framework of dividing and giving tasks to individuals according to their competences. Additionally, it helps in knowing who is accountable and responsible for a particular activity in the organization.
4.3. Systems
The systems in an organization improve the management in understanding the key processes and procedures in the organization (Alam, 2017). Additionally, it helps in understanding the daily activities and how they are done to make the organization successful. Therefore, the Continental White Cap ought to focus on the systems in place to help them make better and sound decisions concerning organizational issues
4.4 Skills
In this, the organization evaluates the key competencies and skills that employees have (Alam, 2017). Additionally, it helps the organization to know the essential skills they need while implementing organizational change. Therefore, if the Continental White Cap has skilled and competent employees, they can easily achieve their new strategy quickly and structure.
4.5 Staff
In this, the organization ought to focus on how many employees they need so that they be recruited, trained, motivated, and rewarded to improve their performance. In this, the organization ought to stress on having the most skilled and competent employees too.
4.6. Style
This focuses on what style of management is used by top-level leaders in an organization to make the organization successful (Alam, 2017). It helps the management to evaluate the different styles and come up with a suitable style that can help the organization become successful. Since the Continental White Cap is a big organization, they ought to go for a decentralized structure.
4.7. Shared Values
The shared values in the organization form the basis and the foundation upon which all organizational activities are done (Alam, 2017). Through the shared values, the organization instils ethical behaviour among employees. Therefore, the Continental White Cap ought to use this to have an ethical culture that is crucial to making the organization successful.
Conclusion
In a nutshell, strategic management is vital for any organization aiming at becoming successful and competitive (Gębczyńska, 2016). Strategic management helps an organization to plan and execute their short and long term objectives properly. In a similar vein through strategic management, an organization gets an opportunity of evaluating the internal and external factors affecting them and how they can handle them appropriately. Lastly but not least, organizations ought to be flexible to adopt the new and emerging technologies that are intensively affecting them.
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