Current SPACE, data showing latest sales, production, operating margins, etc.
Strategic Position and Action Evaluation Space framework is tool used to analyze the performance of the business. Taking the example of Soda Company, this tool will help analyze audits of current condition of Soda Company, its strategic thrust and agendas outlined to increase sales of sodas. This paper will analyze the attractiveness of soda industry and its environmental stability as its external dimensions, financial strength, and competitive advantage as its internal dimensions.
Recently soda production industries have faced a decline in its consumers.
At the same time, Soda Company has proved to be the most aggressive company in the world. Example, Coca Cola Company is the leading supplier of sodas in the country. It has a strong working environment since most people consume sodas and earn it higher profits. This company produces the best brands in the region, making it capitalize on its external opportunity. This makes it sell products to all countries in the world. It gives it a competitive and aggressive posture.
Low consumption brought by increasing health awareness campaigns has reduced profits in these industries. The campaigns argue that regular soda have high calories, which put human health at higher risks of contracting diseases such as diabetes. Studies done on soda industries indicate a decline in soda consumption over the last five years. Others factors include low incomes and availability of substitutes such as tap and bottled water.
Current data collected in soda consumption industries indicate that revenue obtained from sale of soda slumped to 6.1% in 2009. During this five-year period, many Americans had low disposable income, which made them go for tap and bottled water.
Availability of substitutes such as ready to drink tea and coffee has also contributed to low consumption of soda. On average, Americans consumed approximately 38.6 gallons of soda, which indicated a decline from 42.1 gallons consumed in 2008 per capital income. Revenue gained by industries also declined with 1.3%, which is approximately 19.7 billion in 2013 from 3-6% consumed in previous years.
Many companies have opted for other soda products to increase the above margins. PepsiCo and Dr Pepper Snapple Group have recently launched new mid-calorie soda products and sodas that are sugar free, to favor people who do not like the taste of normal sodas. Other soda companies have integrated bottling companies in their businesses to increase their profit margins and reduce costs of manufacturing soda bottles. As a result, the prices of products increased as the production costs decreased. Big industries also took advantage of smaller producers who were unable to increase the prices of their products.
These companies face operating problems since the government is campaigning for sugarless drinks that are healthier for human beings. The government affects this through affecting higher taxes on soda and bans at levels of states and cities. Restrictions on imports are also placed such as those from Mexico. Forecasts from industries state that revenue will decrease annually at a rate of 1.0% to 18.7% billion within five years until 2018.
Per capital consumption of health drinks, decreases within downstream markets such as wholesalers and retailers. This is a negative turn for sugar industries. Differences in prices among retailers and wholesalers increases competition and weaken demand for soda products. This decline was highly felt in 2014 and will continue in the following years. Supermarkets and grocery stores are the greatest indicators of market demand and hence industry performance. However, the demand for sodas in supermarkets and groceries is high which gives industry operators a good opportunity to operate.
2- ABF overall
cultural/behavior/leadership strengths – how these contribute to ABF’s success and how to further strengthen them
Leaders have to consider certain facts such as safety, visible management, and involvement of staff, reports, skills, motivations, culture, communication, and management system
Safety. Top managers of organizations, have considered safety of the organization to strengthen their businesses and earn high profits. Leaders decide on how to manage costs, quality of their products and earnings from those products. Considering these factors will reduce losses in the business and increase profits.
Leaders committed to the well being of their business lead by example. Senior managers are visible in the business to monitor any unsafe behavior among workers and correct them. While doing this, the managers and workers develop a habit of being careful while doing businesses.
Managers encourage their workers to submit reports of safety to the administration daily. This helps in reducing accidents and enhances communications. Feedback mechanisms give response to reporters regarding any actions taken. A positive and constructive response enhances thorough work in businesses.
Leaders develop a culture of involving their staff members while making decisions. They benefit in that hazards are controlled and avoided. In these processes, there are trainings and forums to affect responsible behaviors to workers. This gives opportunity for staff members to report any challenges in the organization.
Leaders create a learning culture to their employees. This is through contributing learning ideas to employees willing to improve themselves. Encouragements to take short courses on safety performance are also important.
Leaders recognize the performance of their employees through offering them promotions, salary additions, benefits, and awards.
Leaders make it known to their employees that they are free to report issues without fear. Leaders must not discipline or fire employees who report issues.
Effective leaders ensure that there is effective communication in their organizations to ensure there is safety.
The management is responsible of creating a comfortable environment for the employees. This will help in monitoring the performance of the employees and communicating the outcomes to all employees.
Leaders and employees create safety culture in organizations. A safety culture comprises the values, perceptions, attitudes, competencies and behavior patterns in the organization. This aspect concentrates on the feelings of the people, their deeds, their policies, procedures, management systems, and organizational structures.