Strategic Management paper

October 24, 2016

Strategic Plan Part 3

Some of the trends that Diageo currently goes through can be seen as epic experiences. Many people with the current technology trends want to experience luxury on a whole new level and thus want some real experience with this. This is something that Diageo can offer. Diageo is also able to personalize its products making customers appreciate their products more. Selling across the border will also be beneficial for the company. The changing workforce is also something that could affect Diageo.

Another trend that is becoming very common for Diageo is its ability to embrace any of the millennial they face. In doing this the company will be able to connect with both its employees and customers. Connecting with its customers means that their products will sell well and they will be able to meet customer needs from the feedbacks they get. Connecting with its employees will help them increase their productivity, as the employees will have the morale to do their jobs properly. Engaging with these employees will go a long way in understanding their needs and hence being able to better their working experience at Diageo.

The leadership at Diageo will also determine a lot in the company’s success. This leadership should be able to address all of Diageo’s issues from the most trivial to the least important issue. The leadership is also responsible in connecting all of its stakeholders and leading the company to greater heights. This leadership should be able to take customer service to a level where all customer needs are taken care of to a point where it is possible, to some extent, to predict the changing customer tastes or even introduce new tastes they’re sure will thrive in the market.

Diageo is also subject to certain risks. The most common risk is change in consumer tastes. If the company is not able to keep up with the ever-changing consumer tastes and preferences, then they will face risk of their business going down. Consumers have different tastes all the time and this is a crucial factor in Diageo’s success. Extensive research hence needs to be done so as to keep up with tastes.

Governments also pose a threat to Diageo with their ever-changing legislations on alcohol consumption or supply. The laws put in place by any government to regulate the consumption of alcohol by its citizens will in no doubt affect Diageo. Since alcohol is perceived as an illicit substance, it then faces many harsh laws that try to regulate it. The quality of their products is also another threat that Diageo faces. The company can very easily tarnish its name due to poor quality products. This can be accidental during manufacturing or through contamination by third parties who are handling the drinks. Copycats trying to imitate their products by selling cheaper drinks so as to sell more can also degrade their product quality.

Part of its strategy is having a competitive advantage over its competitors. The values that Diageo maintains help to achieve these strategies fully. The passion that the company has for its consumers or customers has helped the company grow. It is able to keep up with changing tastes and preferences and even introduce new tastes altogether that workout in the market. The company also has value in their entrepreneurship spirit. They allow growth from both its stakeholders and from the company itself. This gives everyone a sense of belonging to the company. The company has pride in what it does which makes their productivity very high. They esteem themselves in providing the best that taste can get and work towards that. Their efforts to always strive for the best has seen them reach great heights in the alcoholic beverage market.

The strategies of the company involve making a mark internationally with their spirits and being able to provide their products globally. The company intends also to improve their products in the already existing markets as well as work towards being in the emerging markets.

Some of the company objectives involve being the global distributor of alcoholic and non-alcoholic drinks in all related markets. Improving their brands is also one of their objectives. For the company to be able to have roots globally they need to increase their total outlets and also be able to deliver their products globally without fail or delay. Their logistics plan hence has to be compact and very efficient.

Diageo Strengths

· Strong, effective leadership.

· There is low employee turnover rate.

· Enjoys an unyielding goodwill.

· Has a highly organized framework.

· Working offers an excellent learning opportunity and experience.

· Effective internal training and development of top talent.

Diageo Weaknesses

· Only concentrates on luxury products.

· Does not engage in extensive research.

· It is still not widely known.

Diageo Opportunities

· Increasing its brand range.

· It can extend its market to all countries.

· It can reach out to more clients and make products that all persons can afford.

Diageo Threats

· Changes in customer tastes.

· Increased competition from existing similar companies and even new and upcoming ones.

· Loss of their brand name due to tarnished product quality.

· Harsh government laws that may hinder most of their operations in various regions.

The Balanced Score Card

	Metric** (Name of Metric)	Formula (Numerator/Denominator)	% Met or Exceeded*
Routine Metrics	1. Productivity	Amount of Work/Outcome	50
	2. Salaries	Cost/Performance	20
	3. Employee engagement	Attendance/Amount of Work	40
Strategy Metrics	1. Shareholder value	Market Share/Profit	20
	2. Customer value perspective	Customer satisfaction/ customer value	40
	3. Internal operations perceptive	Process performance/impact of change in the organization	30
	4. Employee Perceptive	Number of Turnovers/organizational capability	40
Organizational Oversight Metrics	1. Cost Effectiveness	Cost/Performance	60
	2.Training and Development	Number of Trainees/Total Cost of Training	50
	3.Length of employment	Sum of Length of Service for All Employees/Number of Employees	30

References

Business process management II: Diageo case study. (2006). Houston.

DIAGEO NORTH AMERICA INC v INTERCONTINENTAL BRANDS (ICB) LTD. (2010). Reports Of Patent, Design And Trade Mark Cases, 127(5), 346-404. http://dx.doi.org/10.1093/rpc/rcq023

InfoSource, H. (2003). Alcoholic Beverage Manufacturing Major Companies Report. Twinsburg: Harris InfoSource.

Khan, I. (2015). Managing Innovation and Marketing in a Globally Dynamic Firm: Best Practices in Management at Diageo. Advances In Social Sciences Research Journal, 2(5). http://dx.doi.org/10.14738/assrj.25.1168

Our Strategy. (2016). Diageo.com. Retrieved 24 October 2016, from http://www.diageo.com/en-us/ourbusiness/aboutus/Pages/our-strategy.aspx

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